How to Build a Banking App: A 2023 Guide

8 min readOct 5, 2023

Online banking is making waves these days. It’s no surprise that many businesses are leaning into their own mobile banking application development. The perks? Think convenience, efficiency, and tight security. But how does one get started with the whole development journey?

You’ll need to conduct thorough market research to know what users seek. Given we’re talking about finances here, security is paramount. Also, your app must be intuitive and user-friendly. Making prudent choices in the tech stack and addressing post-launch responsibilities is crucial.

Feeling overwhelmed? It might seem daunting, but Softermii is here to navigate you through this. We’ve been down this road before, working on projects of all shapes and sizes. Take ExpediPay, for instance. We put in a year to build a secure mobile banking solution.

So, how to develop online banking application? We’ve learned much, and I’m here to spill the beans.

Mobile Banking: What’s the Buzz About?

Before breaking down how to make a banking app, let’s crunch some numbers to see why this is worth considering.

Online mobile banking had a whopping value of $772.96 Million in 2022 and continues to grow at 11.70% yearly.

Almost all Gen Z (99%) and millennials (98%) are on mobile banking apps.
In the last three months of 2022, there were 34.6 million downloads of banking apps in the US.
In 2022, Bank of America had around 35.5 million people using their mobile banking. And the year before? 32.9 million.
These apps aren’t static. They’re getting smarter and more intuitive. Think biometrics for tighter security, chatbots for quick queries, and AI for a tailored banking experience. Plus, features are expanding: P2P payments, budget planners, investment options, customer onboarding, and personalized banking tips.

Exploring the Banking Application Development

We need to understand the essence and function of online banking apps in today’s digital era. These applications provide users with secure access and control over their financial dealings.

Here’s an overview of their primary attributes and advantages.

Essential Features

Online banking apps typically encompass the following:

Account Overview. Users have the liberty to review their financial status anytime.
Bill Settlement. Enables users to effortlessly pay bills, bypassing the need to issue checks or visit physical outlets.
Digital Check Deposits. Many apps facilitate check deposits via a simple device photo. It optimizes efficiency and streamlines the process.
Alert Customization. Users can personalize alerts and reminders in line with their needs.
Financial Planning Tools. Certain apps come equipped with budgeting and expenditure monitoring tools.

Advantages of Online Banking Software Development

Developing online banking software comes with a series of benefits:

User Convenience. Facilitates banking endeavors from virtually anywhere, promoting heightened user satisfaction and brand loyalty.
Cost Efficiency. It negates the necessity for physical establishments and personnel, trimming operational costs. It also minimizes the dependence on paper-based documentation, reducing expenses for banking entities.
Broader Outreach. Digital banking avenues widen business horizons, catering to a diverse audience. They include remote users and tech enthusiasts, thereby augmenting the customer base.
Streamlined Operations. Automates mundane tasks such as transaction handling and statement generation. The banking mobile app development fosters accuracy and staff concentration on pivotal functions.
Data Accessibility. Offers real-time insights into expansive user data, like transaction records. It assists in analytical endeavors, bespoke service offerings, and informed strategy formation.
Robust Security. Online banking mandates advanced security protocols, incorporating encryption, multi-layered verification, and fraud surveillance.
Market Relevance. Online banking is pivotal for a competitive edge in the modern digital world. It distinguishes businesses from peers lacking digital acumen.
Integration Prowess. Offers compatibility with a range of systems, such as accounting platforms and payment channels, endorsing efficient data communication and operational finesse.

How to Create a Mobile Banking App: Categories of Banking Applications

The banking app ecosystem is diverse, and it’s tailored to distinct user needs:

Digital Wallets. These store your details securely and facilitate the integration of loyalty cards and P2P money transfers.
QR Code Applications. Capable of generating and scanning QR codes for swift transactions.
Internet Payment Platforms. Assure secure digital shopping experiences.
Peer-to-Peer Payment Applications. Facilitate easy fund transfers between individuals.
Bank-Centric Banks. Offer their respective apps catering to different aspects of online banking.

The choice of an online banking app should depend on user needs, tastes, and the services provided by financial institutions.

Steps to Create a Banking App

After grasping its multifaceted functions, let’s dive into the step-by-step process of developing a mobile banking application.

Establish Your Objectives and Select Essential Features

Embarking on the journey of mobile banking development requires a clear vision. Define the app’s goals, crucial features, and target demographic. Here’s a rundown of potential features:

Authentication and Authorization:

Explore the integration of biometric or dual-factor authentication.
Limit access according to user roles and permissions.

2. Transaction Management:

Allow transfers among different accounts: internal, external, and scheduled.
Offer payment scheduling, confirmation receipts, and transaction histories.
Integrate transaction history and live notifications for better financial tracking.

3. Customer Support:

Think about chat support within the app.
Incorporate a section for FAQs or a knowledge base.

4. ATM & Bank Branch Locator:

Use geolocation to help users find nearby ATMs and branches, complete with directions and hours.
Enhance search capabilities based on ATM functions or services.

5. Gamification:

Introduce engaging elements, like saving challenges or rewards for financial goals.

6. QR Code Scanner:

Provide QR scanning for easy payments and information access.

7. Alert System:

Customize push notifications to keep users informed about account activities.

This blueprint will guide you through the mobile banking app development process.

Conduct Market Research

Undertaking thorough market research is vital for several reasons:

Identifying user preferences to align your app with their needs, fostering a superior user experience.
Spotting areas of differentiation from competitors.
Unveiling emerging fintech trends to leverage new opportunities.
Understanding user grievances to forge a smooth and user-friendly interface.
Effectively targeting your intended user base.

Develop a Mockup

Creating an app mockup is valuable for:

Garnering support and potential investment.
Detecting and rectifying early-stage issues.
Refining the app’s user experience.
Aligning all involved parties for smoother collaboration.

Design an Intuitive Interface

Ensure a seamless user journey by:

Drafting wireframes and comprehensive designs.
Prioritizing clear layouts and easy navigation.
Ensuring cross-device compatibility.
Seeking user feedback via usability testing.

Opt for the Appropriate Tech Stack

When you decide to build a banking app and choose your app’s tech foundation, consider the following:

Future-proofing for scalability.
Robust security measures.
Optimal performance metrics.
Quick and effective development capabilities.
Deciding between native or cross-platform solutions.
Staying compliant with industry regulations.

Construct the App

Backend Development

Focus on databases, servers, user authentication, data encryption, and secure transaction processing.

2. Frontend Development

Make interactive visuals, navigation paths, and input sections using coding standards.

3. Database Development

Centers on designing a robust database architecture for secure and effective data management.

4. Banking Service Integration

Seamlessly integrate with banking services through reliable APIs.

5. Testing Phase

Confirm app reliability, performance, and security through varied testing methods.

Maintaining a collaborative approach among various development teams is key to a successful development process.

Launch Your App and Maintain Its Relevance

The app release process includes testing with a select user group, submission to app stores for review, and promotion post-approval. Following the release, engage in these crucial tasks:

Address user feedback for continuous improvement.
Analyze performance metrics to enhance stability and user engagement.
Swiftly resolve reported issues and update the app.
Adapt to security challenges and regulatory changes.
Foster user engagement and app updates.
Enhance app store listings to boost visibility and downloads.
Strategize upgrades based on user feedback, emerging trends, and business objectives.
Ensure compatibility, security, and stability through constant testing.

Adhering to these steps guarantees user satisfaction and continuous app development.

Mobile Application Development for Banking: Cost Breakdown

Figuring out the expenses and time frame for building a mobile banking app is a complex task; several variables come into play. Here’s a rough outline of some figures to consider:

If you’re developing a banking app in-house from the ground up, expect costs ranging from a few million dollars to around $300,000-$500,000 if partnering with a contractor team. For fintech firms aiming for an MVP, the figures might be between $180,000 and $260,000.
Remember to budget for ongoing yearly maintenance. It may cost approximately $130,000 for all options discussed. Long-term investment strategies may surpass $1 million.
Regarding development speed, a proof of concept generally spans four to six months. Meanwhile, deploying a ready-to-launch MVP with an experienced team might take 9 to 14 months.
Opting for a medium-scale outsourcing firm for building a banking app from scratch can cost somewhere between $50,000 to $80,000.

Remember that these costs are estimates, and real ones can depend on numerous factors. It could be app intricacy, cloud solutions, tech stack, the location of the development team, and the partnership model.

Insights from Our Banking Apps Development Journey

Our hands are familiar with the wheel of online banking platforms. Let’s dive into some of our memorable projects to offer a closer look at our approach:

With ExpediPay, we ventured into fintech via a mobile and web app. We embraced an intuitive yet robust user authentication process for enhanced security, folding in eKYC integration. It fortified the app against potential fraud.

We also incorporated a live chat, ensuring users always had a helping hand during their financial operations.

The heart of the app? A sleek P2P money transfer system that promises speedy transactions.

The outcome? A whopping 13,000+ downloads and an impressive 1,350,000+ transfers in just three months.

Next on the list is SmartStart. Our vision here was clear: a holistic financial app tailored for those with a basic understanding of wealth management.

Challenges? Plenty! We grappled with a complex architecture, seamless banking system API integration, advanced AI/ML credit assessments, and a mission to keep the user interface welcoming. Features included monitoring expenses, managing financial portfolios, and exploring loan opportunities.

The reception? Within two months post-launch, we clocked in 1,296,000 transactions, tied up with 3,000 properties, and welcomed 24,000 users onboard.

Oh, and developing online payment platform software? Yep, we can do it too.

In Summary

Now, you know how to build a mobile banking app. It combines meticulous strategy, user-driven designs, and unwavering security. And more than developing is needed; periodic updates ensure the app stays relevant and user-friendly. Stick to the insights and suggestions in this guide, and your business can pave the way for a digital banking app that resonates with users and amplifies their success in the digital domain.

Thinking of hopping on the digital banking bandwagon? Teaming up with seasoned players like Softermii could be the game-changer. Drop a line to Softermii, and let’s make an outstanding banking application.