A Complete Guide On Mobile Banking App Development In 2021
App Development
10Mar 2021
Mobile apps have transformed the banking and finance industry's face with the emergence of bitcoins, mobile wallets, and banking apps. Can you imagine the fact that almost 1/3rd of the worldwide population uses mobile banking software? This fact has created a significant shift in app users' behavior - people have stopped using desktop internet banking and going to local bank branches. Mobile banking app development rearranges internal banking processes & operations associated with bank clients significantly.
While internet banking allows users to log in to their personal accounts via a corporate banking site, a banking app is a separate software available on personal mobile devices. A banking app is a far more convenient and user-focused service, whereas this app type demands high-security & risk-free functionality.
This blog is a guide regarding mobile banking app development, and it will discuss the benefits of mobile banking, top banking apps, the target market, features, and challenges of this app.
Advantages of Mobile Banking App Development
A phone banking app is a free tool used by clients at their convenience. Besides, spending on mobile banking app development provides a significant benefit in cost reduction for financial institutions.
The pros of building a mobile banking app are as follows:
- Availability 24/7: Compared to traditional banks & ATMs, clients can conduct their regular banking operations anytime & anywhere.
- Multiple Services & Operations: Top banking apps permit app users to perform almost all banking operations. Among them are payroll services, loan tackings, mobile check deposits, etc.
- Time-saving: Clients don't have time to go to a bank & wait in line to withdraw cash or deposit money.
- Paperless Record-keeping: By using mobile banking development wisely, a banking institution can interact with their clients & cover legal issues digitally. While this prevents bureaucracy, clients don't have to reveal their sensitive information on paper.
- Decrease in customer service costs: Mobile banking tech cuts down the cost of customer services by 50 to 70%, as claimed by McKinsey Research.
- High-security: Top banks value their reputation and therefore want to make sure that their IT infrastructure and client software utilize encoding & security protocols to secure customer privacy & information integrity.
- Personalized User Control: Clients can keep track of their expenses & manage their finances more efficiently.
Market Situation: Mobile Banking Development
To get the best result from mobile banking app development, let's go through the current market tendencies and clients' demands from banking software and find the top banking apps.
Mobile Banking Trends
Below are some essential findings of various researches about mobile banking development that are useful to pay heed to:
- 1.75 billion users will perform banking operations through their smartphones in 2019.
- The mobile payment transaction value reached $78.09 billion in the States in 2018. The total is anticipated to rise to $189.97 billion by 2021.
- The top reason for using a mobile banking app is convenience, as mentioned by 45% of respondents in the States.
Target Audience of Mobile Banking Development
India & Bangladesh have got more access to mobile phone use, and therefore to innovative banking services. These markets have begun to spend heavily in mobile banking development.
The Asian & African markets had a 50% boost among the inhabitants who use banking apps. Nowadays, the highest growth in acceptance of modern banking can be observed in upcoming markets, such as:
- Southeast Asia: The number of app users in digital banking has doubled in the last 3 years here. Nations like Singapore, Malaysia, Laos, Cambodia, the Philippines, Vietnam, & Indonesia will absolutely embrace more mobile banking services shortly.
- Latin America: The market hasn't yet leveraged the benefits of mobile banking. Banks have just begun to digitize their services. The no. of app users in banking apps are projected to account for 47% of the population in 2019.
- Eastern Europe: This is the most adoptive market for mobile banking apps currently, and this trend is still rising.
There is mostly an assumption that the target users of financial apps are tech-savvy millennials; however, you might be surprised by the actual outcome.
Baby boomers (45%) between the ages of 50-60 actively use online smart financial apps. Tablets & iPads are their 2nd most used devices.
The younger generation is quite demanding of technology and simultaneously the most engaging group. A poll conducted in 2016 by MX technologies recognized that 60% of app users are prone to shift to another bank if a mobile banking service is not efficient.
So, what do app users actually expect from mobile banking app development?
As per 2016's Federal Reserve Board Report, the most common operations done with banking apps are as follows:
- 94% of app users check their account balance & recent transactions
- 61% transfer money between bank accounts
- 57% receive alerts from their banks
- 48% use an app or banking site to pay their bills
- 48% deposit checks electronically with the device's camera
- 40% find the nearest ATM/bank branch
- 25% transfer funds to another person's account
By 2017, the number of users engaging with banking or online apps had grown from 27 to 46 percent, which means that the banking sector has totally undergone changes characterized by the decline in human interactions like visiting a branch or contacting a call center.
Best Banking Apps
Below are the mobile banks and their unique features:
Bank of America
Identified as the top mobile banking app for its security
- The ability to alert the bank about your travel & location for a necessary account easily
- Proactive contact from the bank if there is any suspicious action
- Ability to replace and activate card straight from the app
JP Morgan Chase
Top banking app for prepaid cards in the States
- Ability to reload the debit card easily
- Simple online payment management
- Ability to access several accounts including savings, checking, credit cards
- Bill payment option
- Ability to schedule loans, mortgages, payments
- Transfer funds via Zelle (US-based digital payment network)
- Ability to see & redeem rewards with Chase rewards credit cards
Capital One
Top Banking App For Customer Service In The States
- Ability to see all bank accounts
- Ability to keep track of credit history and purchases
- Ability to redeem credit card rewards
- Account access via Apple Watch
- Fingerprint login
- Prompt push notifications
- Easy card lock in case of theft/loss
- Fraud reporting straight from the app
Wells Fargo
Rewarded as the top banking app for monitoring investments in the States
- Offer accounts for savings
- Provide real-time market data quotes & graphics for an improved decision-making process
- Investment in a range of securities such as stocks, mutual funds, etc
- Ability to set notifications through email or text messages
- Ability to track & monitor investments
HSBC
The UK-based mobile banking app
- Fast & secure login with Touch ID & Face ID
- Ability to verify transactions, accounts, direct debits, and standing orders
- Ability to view & install personal statements
- Fast card blocking
Chime
Mobile apps with the whole user experience & a banking service with a digital presence only began in the States.
- Ability to access money via 30,000 plus fee-free ATMs
- Ability to gain cashback using the service
- Ability to create everyday balance notifications
- Ability to build real-time transaction notifications
- EMV chip card security
Functionality: Mobile Banking App Development
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Important Mobile Banking Features
The general features used in mobile app banking development that are essential are as below:
Account Creation
It is super important to develop a secure & fast authorization process. Multi-factor authentication is a protected sign-in option; however, it takes some time to fill in the essential information. Moreover, biometric authentication using physical user metrics is faster and more fun.
Account Management
This may include a range of mobile banking features. App users can check their bank accounts, cards, review account balances & record history, etc. It is also possible to apply some extra functionality. For example, the ABN AMRO Bank in the Netherlands included an exclusive feature of mobile banking for personalized account management. This enables users to create investment plans, perform repeat payments, and set a savings goal.
Customer Support
This is one of the integral mobile banking features since the client should address a bank rep & ask questions 24*7. Moreover, it is possible to advance & personalize the user experience by using AI in a chatbot.
ATM And Bank Branch Locations
The basic feature of mobile banking services shouldn't be abandoned. To advance the experience, it's possible to implement VR technology. This is an exclusive feature of mobile banking applied by RBC. It permitted the bank to grow the number of its app installs drastically.
Secure Payments & Transactions
Payments for services, fund exchanges, and P2P transactions should be processed securely & performed anytime & anywhere with the banking app's help.
Another alternative to this feature in mobile banking app development is using QR codes for goods & services payments. QR code scanning is a quick & easy way to perform these operations within the app. Only some banks have offered this mobile banking feature to their clients.
Push Notifications
Mobile banking app development should use reminders and notifications to boost user engagement & app promotion. It is essential to manage this aspect and plan the communication strategy with your clients beforehand. (Remember that users dislike receiving intrusive notifications.)
Additional Mobile Banking Features
The app features mentioned above are the essential features of mobile banking app development. To increase user tracking and interest, you should consider some innovative mobile banking features, such as:
Spending Trackers
Mobile banking development should concentrate on user requirements, even if they aren't explicit. This feature can control personal budgets and set some goals for desired purchases. The system can build personalized dashboards based on user details, give essential motivation, and inform users regarding progress.
Alternatively, app users can set some scheduled payments & bills beforehand not to miss an important transaction. The app is used to track buying habits, plan budgets, and save on expenditures.
Cashback Service
M-commerce sales rose to 300 million in 2017, and the total is expected to double in 2019. Thus, users are encouraged to use your bank account to pay for goods and services with the cashback possibility. This can be a great base for your loyalty program. Soon enough, this mobile banking feature will be included in most banking apps.
Personalized Offers
It makes sense to create discounts, coupons, or special offers with mobile banking app help. The opportunity lies in collaborating with cafes, coffee houses, restaurants, and so on for the provision of specific coupons/discounts. This encourages sales and simultaneously engages the user with your mobile banking app.
Unique Services
Mobile banking app development can include other non-conventional services. These services can consist of ordering a taxi, buying tickets, booking a table, delivery, & more.
For instance, a Polish bank reached out to new app users with the feature of paying for shopping, taxi-hailing, and public transport straight from its mobile app.
App For Smartwatches
Smartwatches have substituted smartphones in several operations. Why not consider building a banking app for these wearables?
The Australian Bank of Melbourne was the 1st to build a banking app for smartwatches. The functionality included payments for goods & services, balance checking, receiving alerts, and finding ATMs.
Finance Sharing Feature
Visa research shows that to attract millennials, it makes sense to focus on mobile banking app development for budgeting. This might include splitting bills and sharing finances. For example, the app from Emirates NBD has a bill-splitter function where every user has to include some total and show the no. of people participating in the operation through social networks.
Final Suggestion: It is better to build a few apps with distinct mobile banking features instead of complex software with lots of information, data, and operations. Try asking your target audience about their priorities in banking processes and concentrating on rendering the first solution.
Challenges In Mobile Banking App Development
As per the Nielsen survey, the primary barrier to mobile banking use is the inability to rely on a transaction made through this channel, both among more wealthy boomers and millennials. This poll has been supported by Statista, indicating that 72.7 percent of residents in the States did not use any phone banking app worrying about its safety.
The primary risks & challenges for mobile banking app development are:
- Safety concerns.
- The security of user privacy.
- Detailed verifications of user input.
- Simultaneously keeping the services easy to use.
Security should be correspondent with your app. The overall security suggestions to use in mobile banking app development are below:
- Check & review the safety policies and align them with mobile banking development & device specifics.
- Build server infrastructure correctly and choose trustworthy data storage
- Include the technology of multi-factor authentication & digital signature in a mobile app for more safe transactions
- Include inactivity timers for every session of app use
- Include high-end encryption in phone banking apps and card storages to get rid of access to the data from another device.
- Create a checker of password strength
- Check the user's device for security breaches before app download
- Educate your app users about the best security practices with some guide like not saving sensitive information, transaction-related data on the device, and credentials.
Stages & Cost Of Mobile Banking App Development
This section will discuss a 2-step process we use for mobile banking app development that even includes some information about the costs.
Software Development Process at MLSDev
Mobile app development services and mobile banking development can be divided into 2 stages: Development & Discovery.
The discovery stage involves all the preparatory work for the project performed by a business analyst responsible for the app development from a business viewpoint and a software architecture that aligns business aspects with a technical application.
The deliverables after the Discovery stage include:
- Finalized app concept
- Product design (clickable prototype, UX & UI)
- Project architecture plan
- Product backlog
- Market & competitor analysis (optional)
Once these deliverables are ready, it is likely better to define a precise development budget & project delivery date.
During mobile banking app development, a cross-functional team is allocated. This includes typically developers that implement front-end developers, back-end developers, and quality assurance engineers. The entire process is regulated by the project manager, who ensures that all agreements, arrangements, and budget goals are met.
About mobile banking app development cost, 15 banks worldwide spent, on average, $132k per app. The total expenses accounted for $80 million and included 606 different apps.
Another research performed by Clutch shows that the cost of complex solutions, including mobile banking app development, ranges from $200k - $500k.
There are 2 methods of mobile banking app development, depending on your strategy. In case you are keen to test some innovative functionality, a clever approach is to split the full banking software into some logical app versions. This will help you release the app more quickly and test these unique mobile banking features with an actual user.
This 1st app version of mobile banking app development might take around 3-6 months at the cost of USD 50k to 80k/platform. You can then move ahead with developing the subsequent app versions after getting feedback from the market.
Another option is to plan & develop an app with fully-fledged mobile banking features. Here, the process of mobile banking development will take more time and a significant budget depending on the needed scope of work.
You might wonder why banks are spending on mobile banking app development. This is the most efficient user engagement method, which absolutely outweighs the conventional methods that include support staff, resellers, and agents. Mobile banking development acts as a practical communication point with the possibility to receive real-time market insights and enhance banking services.
In general, app development costs are unpredictable during the early stages due to the following factors.
- Vendor type & location
- App complexity and the no. of app features
- The complexity of UI/UX design
- Back-end infrastructure & connected APIs
- Inclusion of extra branded visual elements
- No. of platforms to be built (Android, iOS, web, etc.)
- Development approach (mobile web, native, hybrid, etc.)
The significant factor influencing mobile banking development cost is the per hour rate of experts in the field. Ukraine is a well-renowned region rendering remote software development services, characterized by reasonable pricing & superior-quality software development.
How To Develop A Mobile Banking App Project Effectively
The banking sector will certainly become more digital. Mobile banking app development enables the industry to boost operations efficiency, prevent bureaucracy, and improve the user experience while promoting banking services.
So, what makes for a good banking app?
1) Applicable & user-friendly functionality that is protected & easily accessible
These can include, but may not be confined to:
- Verifying the account balance without logging in.
- Integrations with device information & tools like an address book
- User customization based on the latest actions & systematic transactions
- Tailored offers
Creation of customized and helpful notifications
2) Application of cutting-edge, innovative technologies, such as Big Data, AR, VR, AI & Blockchain to improve the user experience
3) Including new feature and scale software in line with emerging mobile banking trends, such as:
- Use of (VUI) voice user interface to enhance user engagement
- Use of (AI) artificial intelligence and (ML) machine learning for self-service in the banking industry
- Use of highly-advanced validation technology with biometrics to get rid of data violations
This shows that mobile banking app development provides several opportunities to create a user-centric banking field experience. This sector still has plenty of room for good mobile app development company, so it is your time to plan and develop a fantastic banking app that will make your human's life convenient.
Harnil Oza is the CEO & Founder of Hyperlink InfoSystem. With a passion for technology and an immaculate drive for entrepreneurship, Harnil has propelled Hyperlink InfoSystem to become a global pioneer in the world of innovative IT solutions. His exceptional leadership has inspired a multiverse of tech enthusiasts and also enabled thriving business expansion. His vision has helped the company achieve widespread respect for its remarkable track record of delivering beautifully constructed mobile apps, websites, and other products using every emerging technology. Outside his duties at Hyperlink InfoSystem, Harnil has earned a reputation for his conceptual leadership and initiatives in the tech industry. He is driven to impart expertise and insights to the forthcoming cohort of tech innovators. Harnil continues to champion growth, quality, and client satisfaction by fostering innovation and collaboration.
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