With mobile banking app development, banks have transformed the way their customers spend and handle money.
Just about 10 years ago, people would need to queue in bank branches to transfer money or pay bills. Creating a new bank account can even take as long as weeks. Today, thanks to mobile banking app, customers can do all that whenever and wherever they want.
In this article, you will get to learn everything about mobile banking app development. If your banks are planning to build mobile app or is actually working on one and need some more ideas, read on!
Table of Contents
What is a mobile banking app?
A banking app is a mobile app that allows customers to access their accounts and use banking services from their mobile devices (phones and tablets).
While it varies from bank to bank, most mobile banking apps have some features in common. At the very least, a banking app must allow users to view their current balance as well as transaction history. Other basic functionalities are money transfer to other accounts, scheduling payments, paying bills, and finding ATM locations.
For example, KMS Solutions has helped ACB, one of the largest banks in Vietnam, build a mobile banking app for its business clients. The app's MVP is finished within 4 months, and has most of today's innovative features. You can learn more about this case study here: KMS Solutions helps ACB developed mobile banking app in 4 months.
Why banks need to build mobile banking app?
Today’s consumers are glued to mobile phones. That palm-size device is present in almost every aspect of our daily activities. People use it for communication, shopping, entertaining, and even working.
Thus, mobile app offers ample opportunity for banks to become a part of their customers’ lives. A report by We Are Social has pointed out
- The amount of unique mobile phone users is 5.29 billion, which is 67.1% of the total world population (7.89 billion)
- 90.9% of users access the internet via mobile devices
- 38.7% of internet users from 16 to 64 of age are using banking and financial services apps
While it’s provided for free, a mobile banking app can benefit banks in many ways that are not just limited to customer experience. Building a mobile banking application can give banks significant advantages in terms of efficiency and cost reduction. In other words, the banking app is a win-win deal for both banks and their customers.
Online frauds can be threatening. But there are many solutions banks can leverage to strengthen their mobile app’s security.
An eKYC solution, for example, can make banking applications more secure than a web portal — with biometric authentication, OCR (Optical Character Recognition), face matching, ...
Cutting operational costs
Building mobile banking apps and promoting them as the main channel for banking services can help banks reduce operational costs. The more customers use the app, the more banks can reduce the use of paper. Moreover, when customers visit bank branches less often, banks can reduce costs associated with maintenance and staffing.
Additional revenue streams
Mobile banking app proves to increase return on investment in many ways, according to Fiserv. For example, the study reveals that banks can realize 72% growth in revenue from mobile banking users, compared to customers who only use branches. Also, after 3 months of using mobile banking apps, customers are likely to increase the number and value of their debit and credit card, ATM, and ACH transactions.
Banks can generate more revenues with mobile app by adding value-added features, including Lending, Insurance, or BNPL.
Better customer experience
Banks can provide a digital banking experience as user-centric as that of an eCommerce or ride-hailing app. Thanks to mobile banking app, banking services will always be available within customers' reach. Customers can solve their banking needs whenever and wherever they are.
In addition, mobile devices offer greater opportunities for personalization than those of branches or even websites. Why? Mobile is until now the best environment to apply Machine Learning (ML) and Data Analytics (DA) to track and learn from user behaviors. A mobile app with ML and DA can provide insights tailored to customers' preferences and past activities.
Must-have features of a mobile banking application
There’s no one-size-fits-all model for a mobile banking app. Depending on the banks and their customer’s needs, the type and number of features should be made to fit accordingly. Nevertheless, there are some that we consider “essential”. They are the kind of features that every app must have to deliver a true mobile banking experience.
It’s a set of processes to verify customers and provide them with new bank accounts. Given today’s frauds and their sophisticated schemes, a secure yet quick account opening process is critical.
Conventionally, banks send OTP via SMS to ensure customers are who they claim to be. But SMS is not secured nor cost-effective. Alternatively, more banks are using eKYC solutions. eKYC is a host of verification technologies, such as biometric authentication, Optical Character Recognition, face matching, and more. They make account opening more secure, and even fun for customers.
This is more of a set of features. Those that allow users to check their cards, bank accounts, review account balance, and transaction history are all account management features.
Banks can take account management further with personalization to provide features that help customers set savings goals, create investment plans, and schedule repeat payments.
The ability to reach out for help instantly and round-the-clock is another must-have feature of the mobile banking app.
To supplement human staff, many banks also build intelligent chatbots and embed them into the app, which serves as customers’ financial assistants.=
ATM & bank branch locations
Even your app can transfer money in real-time, there would be times customers need to drop by ATMs for cash or visit bank branches for paperwork. In situations like these, an ATM & bank branch locator can be a life-saver for your customers.
Payments and transactions
A banking app should have the ability to process P2P transactions, payments for services, and fund exchanges securely and quickly, anytime and anywhere customers want.
To help customers shop even quicker, there are banks that have added QR code scanners to their mobile banking apps
In the form of SMS, emails, or pushed phone notifications, the alerting features provide succinct and timely valuable information to customers about successful transactions, suspicious money transfers, low account balances, or product updates. The messages can be automatically pushed to customers, triggered by predefined events or in response to customers’ inquiries. Alerts and notifications let customers know that they are cared for and kept informed of any new events. Alerts also prove to help banks reduce on-hold times at call centers.
Nice-to-have Mobile Banking Features
The app features above are pillars of a typical mobile banking application. There are more innovative features that can help banks increase their user traction and interest.
This feature allows users to set spending goals and control their personal budgets. It also generates a dashboard based on users’ spending activities, gives personalized advice, and pushes notifications on users’ progress.
Cashback feature pays back a percentage of the amount customers spend on goods and services. It’s more of a customer loyalty program, where customers are encouraged to use the app to pay.
As another type of customer loyalty program, personalized offers are discounts or coupons that are automatically triggered based on customers’ activities. Nevertheless, banks would need to partner with 3rd-party merchants to enable this feature, such as restaurant, coffee house,
App for smartwatches
In certain segments of customers, smartwatches are replacing smartphones in some aspects. Banks could stay ahead of the curve by making their mobile app integrated and compatible with smartwatches
Mobile Banking Application Development Processes
1. Research And Plan
In market research, it is essential to know what your competitors are and investigate other existing apps on the market. Doing careful research makes sure your project has the right direction.
Now that you have the research results, the next step is to identify who your users are. Whether your app is intended for individual customers or for business clients. Knowing your users is not just enough. You also need to understand their pain points so that you can define the app’s features.
The output of this step is a detailed plan, which includes expenditure estimates that will be the foundation for your project’s budget.
A prototype describes how the mobile banking app will work.
Every app starts out as an idea. To translate that idea into a working product, you need a prototype generally demonstrating the app’s structure, features, and design elements. Typically, people start prototyping with a low-fidelity wireframe, sketching the app’s home screen, users’ accounts, personal dashboards, and the layout. As its purpose is to give only a general idea of the app, the wireframe only needs to include black-and-white content, such as boxes, lines, and texts. Once the wireframe is feedbacked and approved by all stakeholders.
Next, the wireframe can be beautified into a hi-fi prototype, including a graphic presentation of a product, layout, interface components, the color scheme, and micro-interactions. Similar to the wireframe, a prototype visually describes the mobile banking app that you’re building but is better and more detailed. It is then proposed to focus group to test its interface and functionality.
3. Graphic Design
There are many best practices for designing your mobile applications. Check out these tips:
- The mobile app’s typography, icons, color palette, buttons, and forms should follow your banks’ brand guidelines;
- The navigation should give a general idea of the app’s logical architecture;
- Design elements such as buttons, links, forms, icons should be unique and eye-catching, standing out from the background;
- Colors, images, and video files should evoke certain emotions of users;
- The app should be adjusted to iOS and Android design standards;
- A mascot (such as Discord’s Wumpus) can give your app a personality, making it feel closer to your customers;
Explore more UI/UX design best practices for mobile banking app.
4. Choose A Technology Stack
There are many critical areas for app technology stack that you want to focus on, such as front-end, back-end, cross-platform frameworks, robustness, or security
Your checklist for the technology stack should involve the below criteria:
- project scope and complexity;
- the type and number of professionals, as well as their level of their competence;
- necessary tools and software, either developed internally or bought externally
- documents and specifications.
Native apps, hybrid solutions, cross-platform applications are the 3 most popular types of app. Each of them is very different from the other with its own pros and cons.
5. Develop And Test
In the development process, the team would build architecture, develop life-like user paths and journeys, create a user-friendly interface that won’t have analogs based on the technology stack chosen in the previous step. On the other hand, Mobile App Testing helps the team optimize in-app experiences, improve core metrics, and experiment with the mobile app features currently in production.
This step is the hardest one as banks can lack the necessary staffing for the project. In that case, banks can look for outsourcing services. The outsourcing vendor will either provide you with the experts you lack or give you a fully functional team depending on your needs
6. Market the App
Google Play Market and Apple’s AppStore are the two most popular app marketplaces. They also have different app requirements that should be followed or else your app will be rejected.
7. Feedback, Improve, And Update
Launching the app is just the start. To get valuable feedback so that you can improve and update the app, you can ask your users for feedback, contact app review sources, ask influencers and bloggers to test your product. Based on the feedback, you can have appropriate actions to improve and update your app.
At KMS Solutions, we provide banks with the latest technologies and experts to stay ahead of the Digital Banking curve. Learn more about services here.