How to Make a Banking App like Monzo or Revolut
FinTech technologies have made our life significantly easier. Long queues to pay bills, open a new account, make transactions — it’s not about the 21st century anymore.
According to Deloitte Insights, 94% of mobile banking customers use online banking platforms at least once a month. It shows us that now many people prefer online banking to an offline one. What’s more: this audience is active, loyal, and will use your services regularly.
Online banking allows us to do everything with a couple of taps. Most people can’t imagine their lives without online banking — it saves time and requires much less effort than regular banks.
Curious about how to create an online banking app now? Let’s find out!
🎁 Benefits of Making a Banking App
Before we crack on with the design and implementation of a mobile banking app, let’s briefly go through the benefits it brings.
Expand your clientele 📈
With a banking app, you can stand out and reach a wider audience. An app can cover your corporate clients’ pain points and offer a great fintech solution to your new ones right from the start.
By developing a mobile-only banking app, which means that every financial transaction can be done via an app, you free yourself from being dependent on the location.
|Monobank case study|
|Monobank is a Ukrainian online-only mobile bank that has no offline branches and offers all services via a mobile app
When they started in November 2017, they obviously had 0 clients. Just in almost 3 years, in September 2020, they had more than 2.6M customers. Only in August 2020, 131,660 clients started using monobank.
This rapid jump proves to us that mobile banking solutions take off extremely fast. So now, when the market isn’t overloaded with mobile banking apps, it's the best time to develop one.
Know your customer 👫
Information is a big power for any business. In an online business, it’s easier than anywhere to get it. Every user’s action done in an app – loan payment, deposits, shopping, traveling – is recorded and can be used for developing new marketing strategies and lead to an increase in sales.
Besides, information collected from apps can be used for:
- Analyzing customers’ behavior and making business predictions. For example, automatically calculating a customer's credit card limit based on his activity or estimating the volume of new deposits next month considering historic data from your users.
- Increasing sales by running specified targeted campaigns. For example, offer premium cards to active users.
Cut expenses ✂
The design and implementation of mobile banking itself aren’t that cheap. But in the long run, it’s more than beneficial.
By beneficial we mean that many costs that occur while running a full-offline banking business can be reduced or even removed by developing a mobile banking app. We made a comparative analysis of how different expenditures vary depending on the type of bank:
|Lots of branches needed to cover all clients needs in one area||A few branches to work with big financial operations (real estate, car dealership, etc.) would be enough; all the simpler services (transactions, deposits, payments) can be done via the app|
|Human-based Support Service. Thus, you have to set up a workspace for every support manager and provide him with the needed equipment, days-off, sick leaves, etc.||A chatbot can help clients with their problems at any time. You’ll still need a Support Team but you may hire significantly fewer people.|
|Constant cheques and contracts printing, sending bills. Consequently, you have to allocate budget for printing, paper, and delivery of these documents.||All bills and documents are available in electronic versions. In this way, you can noticeably reduce costs and be more eco-friendly.|
Encourage clients to use your services 📣
Online banking apps users are very active and dedicated. It’s so because mobile banking apps are convenient. Be it taxi payment, grocery shopping, investing — everything can be easily done via this banking solution.
Thus, if you have an online banking app, it will encourage your clients to use your services more often instead of cash and services of other banks without such a convenient solution. That means you increase your revenue (more use — more commissions) and stay ahead of the competition.
In addition, it’s a great idea to implement gamification and encourage customers to use your app services even more. It can be:
- Achievements (“Spend $100”, “Pay for taxi 5 times”, etc.).
- Bonuses for regular use.
- Customized profile avatars.
Build your digital brand and use it for marketing purposes 💻
The brand recognition of a bank is of high importance. Being well-known makes an impression of a trustworthy service that people talk about and use. And nowadays it’s quite hard to get attention to your service.
It’s because now people hardly pay attention to advertisements. Many use ad blockers or just close the ad without even reading it. However, an app is something most people can and will use. Thus, creating an online banking app is one of the most effective ways to be that one bank everybody knows and uses.
Speaking of, mobile banking development can help you attract digital-first customers. The availability of well-structured online banking will make your company look modern and high-tech. Keep in mind that the availability of online banking apps becomes more significant every day.
✅ Top 3 Things Worth Attention When Creating An Online Banking App
User-friendly Design 👈
One of the most crucial parts of starting an internet banking app is a simple user-friendly design. An app that’s difficult to use can be repulsive for users. User-friendly here means:
- Based on navigation patterns familiar to your users. All features are accessible at one-two taps.
- Personalization and customization options (theme color, customized avatar, etc.).
Besides, all transactions and actions via the app should be quick and well-organized. For instance, in Germany, there’re still banks that send you sheets with ~30 security codes that customers must enter to verify each separate transaction or payment. And even then you have to wait for 1 day (at its best) till the transaction reaches the recipient.
|Revolut case study|
|Revolut is a financial app launched in the UK in 2015 offering only transfer and exchange. Nowadays they offer innovative services and products.
To create an account in their app you don’t have to visit a branch or sign a bunch of papers. You can do it directly from your phone and it won’t take you more than a couple of minutes, as Revolut states.
This is a good example of a simple banking system which mobile owners love and use.
Basically, try to follow the rule:
Provide as many services as you can online at the shortest possible time.
What’s more, don’t be too intrusive with offers and push-notifications — only well-developed personalized offers will help you as the app’s owner increase sales and be valuable for a customer.
Take Device Differences Into Account 🍎
Keep in mind that different customers use different operating systems. We recommend building the product for Android and iOS, so make your banking app optimized for these two major platforms.
Not only OS matters — screen size, phone features (it may be not optimized for biometric authentication), etc. Some people may use an old version of OS, some update constantly — all these things have to be considered.
To make sure that your app is optimized for each OS and gadget dimensions, you can:
- Run pre-tests on different devices and simulations. It helps you not only optimize the app but also test security and simplicity.
- Analyze your app by gathering metrics, running surveys, and getting feedback on user experience.
Different Generations — Different Values 👐
Young users tend to turn to mobile banking apps more frequently than their older peers.
According to Fortunly, approximately 30% of consumers under the age of 54 use mobile payment services like Venmo and Apple Pay at least once a week, while only 12% of those older than 54 do the same. It proves to us that zoomers and millennials (18-35 years) use these apps more often than others.
Moreover, Statista claims that almost half of people from 18 to 24 use mobile banking apps weekly:
Not only the frequency but the values are different as well. This generation cares more about emotional connection and gamification than their parents and older relatives.
They like to feel and show empathy, appreciate being cared for, loved, and entertained. Even in such a “serious” type of app as a banking one.
Let’s have a look at the monobank case again. These guys have their unique gamification element — a cat! It’s used for marketing purposes as well as for customers’ entertainment. You can find it in different animations in the app, when completing achievements, and so on. Even with this small detail alone, they attract cat-lovers from all over Ukraine. And trust us, the number is impressive :)
Here are some examples of successful empathy and care from mobile banking apps:
- Chime shows that they’re happy for their clients and do it with push-notifications. They surely could just send a cold notification about money going in but instead they make it more emotional using a friendly sentence at the beginning and “🎉” emoji.
- During the COVID-lockdown, after the payment at the store or take-away, monobank sent the “Don’t forget to wash your paws when you get back home 🐾” reminder along with the amount of money paid to show their care. Why paws? Because they have a cat as their “spirit animal”.
In addition to empathy, clients of these generations love gamification features: tasks and achievements, challenges, giveaways, and competitions.
Let’s review some monobank examples one more time. It encourages clients to use their cards more often through the system of achievements and stars. Completing achievement gives one star. After collecting N stars, you can exchange them for branded merch (hoodies, T-shirts and other stuff with monobank’s logos).
In this way, they not only encourage their clients to use the monobank app more often but also get free promo as people are walking in their branded clothes.
Finally, most mobile banking apps use more or less similar features. Thus, it’s quite hard to get their attention without standing out. With these emotionally valuable features, you can make your brand unique. More importantly, you give users one more reason to prefer your services to other online banking apps.
🏦 Banking Infrastructure, BackEnd & API for a Mobile Banking Development
Before we dive into the must-have features of a Banking App, we’d like to point out that in this article we will mostly focus on the FrontEnd part in the first place.
Meaning that the BackEnd development isn’t the highlight of this article since each case is highly individual.
There are 3 most typical use-cases of your BackEnd setup:
- You’re a bank & have your own banking infrastructure & API.
- You use the banking infrastructure & API of your partner.
- You use Banking-as-a-Service startups (BaaS) - on-demand service providers that allow companies to build FinTech Products without building their own Banking or Payment Infrastructure. Normally, they either have their own banking license or partner with banks, which provide them their infrastructure.
Actually, we at Stormotion happened to work with the integration of Mangopay for one of our first clients OvalMoney.
Their idea was quite interesting & useful - you save money as you spend them.
For instance, you save $4 for each fast food meal you had this week. Sounds fun, doesn’t it?
So basically, what we did with Mangopay was:
- During a new user’s Sign-Up, we created a wallet for each one of them in Mangopay.
- Users could attach their bank accounts to that wallet. It was done by implementing Yodlee API.
- Then, Mangopay was allowed to charge users and transfer a predetermined amount of money from their account to their Oval-wallet. It happened either on a regular basis or after a certain purchase (as in our example with fast food).
By the way, If you’d like to find out more about Payment Gateways & APIs, you can check out our article dedicated to this topic:
📱 Top Features of an Online Banking App
In this section, we’ll go through the basic and extra features of a mobile banking app. Nevertheless, creativity is always a good thing, and if you want to stand out, you could add some unique features to your app.
# 1: Sign Up & Profiles + Settings 🔐
This part is extremely important for mobile banking development. It’s because this is where you implement security features for authentication (password, biometric scanning, additional questions, etc.).
While we normally recommend not to request too much info at the “Sign Up” phase, here things are different. You have to make sure that your clients’ profiles will be under strong protection.
By that we mean a complex password, connection to a phone number or to email, personal security questions, and that customers are acquainted with Confidential Policy and other banking terms they accept by creating a profile — all of this should be done while signing up.
Speaking of settings, it’s a good way to make the user experience more personalized. You can add:
- Turn on/off double transaction.
- Set the limit to online payments/credit.
- Add a savings tracker.
- Set a payment reminder.
# 2: Home Screen
Basically, Home Screen is what users see right after they sign in. In a banking app, Home Screen should be as useful and user-friendly as possible. By useful we mean that it should contain:
- Balance details. It could be either for your main card on the screen or for each card separately.
- Wallet. It’s a list of cards that provides quick access to every card's details. It would be useful if you let your users have different types of cards as well in case if they want to make a transaction between their cards.
- The list of last payments and transactions.
- Quick access to main features — transfer, currency exchange, make a payment, etc.
Besides, Home Screen could be changeable. Users can be able to choose what’s on their Home Screen. It can be deposits, credit payments, insurance, donations, service payments, and so on — “one size fits all” isn’t the case here.
# 3: Payments
Many people take the “Transfer money” feature for granted, however, it’s important and worth attention.
What’s exciting about banking operations feature that it’s hard to overdo — the more, the better. Apart from transactions between any cards, banks, and accounts, we recommend adding payments for:
- Mobile communication.
- Utility bills.
- Public services.
- Loans & credits.
- Fines & taxes.
- Travel & transports (bus, train, plane tickets, hotel or Airbnb booking, etc.)
It wouldn’t be extra to allow users to set monthly/weekly payment reminders for anything they need. It will save your customers’ time and reduce the stress from forgetting about their recurring payments.
# 4: Transactions History
It’s essential that your customers can easily track their transactions and payments since the very beginning of their journey in your online banking app.
Moreover, the transaction description should be well structured and include:
- Amount of money transferred.
- Recipient (either card number and/or name of person or company)
Additionally, you may display geolocation where the transaction took place (in case it was PayPass payment) with a mark on a map.
It’s a great idea to filter the expenses. Filters can be completely various: by category (food, healthcare, transports, clothes), by date, by the amount of money (up to $50, $100, $250, ect.), by destination, and so on.
Such an expense management feature brings additional value to the customers and improves their user’s experience.
# 5: Branches and ATM Map
We bet everybody has experienced confusion because of not being able to find an ATM.
We recommend adding this feature since you never know when your clients will need this. Maybe they’re lost, or don’t have time for seeking — if so and the map isn’t available users won’t be able to use your services.
You could make your map extra and add some gamification features. For instance, “Take cash from the ATM on the X Street”, “Take a selfie near the Y ATM” achievements, customized avatar for each ATM and branch, etc.
It’s also a good idea to implement a real-time counter which shows the number of people in the queue.
# 6: Support Service
Customer support is one of the pain points of some banks. It may be not well organized, chatbots may not be programmed to deal with a question slightly different from the one that’s on the list. And if you want to call a support service you might have to wait for a long time.
We’re sure that developing a great customer support system is one of the best ways to become that one bank that clients love and are willing to use. What does great mean? There are several points we want to emphasize. Customer support has to:
- Provide a chatbot (artificial intelligence that’s programmed to handle simple troubles and answer questions) and live chats.
- Be quick.
- Have a wide range of listed answers to popular questions and problems.
- Offer 24/7 phone support for an emergency.
- Provide a list of contacts, including email, various phone numbers, etc.
- Offer pre-written answers to questions that imply a “Yes” or ”No” answer.
- Now it’s also popular to provide support via popular messengers like Facebook Messenger, Viber, Telegram. Users can be redirected right there.
# 7: Push Notifications
Push notifications are a great tool for increasing sales by offering personalized offers and retargeting customers. It is useful for customers as well since it works as a reminder about monthly payments, spendings limitations, savings reminders, etc. Generally speaking, push notification can be used:
- To remind customers about their scheduled payments and savings.
- To improve your marketing strategy and by making the user’s experience more personalized.
- To double-inform customers about their payments and expenses in real-time.
Nevertheless, some people are not big fans of push notifications so this feature should be optional for them.
# 8: Extra Features
In this subsection, we will list some additional features that are not necessary yet improve the user’s experience and/or are used by the competitors. These are:
Cashback means getting a small part of money back from your purchases. By implementing this feature you make the process not only beneficial but convenient since the money goes straight to your bank account. Additionally, it works as a strong competitive advantage.
- QR code payments.
QR code payment is a contactless payment where a transaction is done via scanning a QR code from an online banking app through your camera. It’s time-saving, but not many shops and institutions offer such payment opportunities. Nowadays QR codes are more widely used for online payments.
In the modern finance market, investments and tradings are getting more and more popular every day. By allowing your customers to do it via your app, you improve the user’s experience and get some extra points why users should choose you and not other banks.
- Splitting bills.
This feature is just the ticket for users who go out with friends frequently or have a roommate, etc.
Let’s say you’re out for dinner with your friends. This feature will calculate what everyone owes for their own dishes and costs for appetizers and wine, for example, will be shared. You can create a joint payment and everyone will pay what they owe.
|Monzo case study|
|Monzo is an online bank based in the UK. In 2015, they started as prepaid debit card providers but now over 4M customers use their diverse innovative services.
Monzo created their own Shared Tabs that allow users to split different bills and payments conveniently. They can create one-time bills Tabs or a joint Tab for constant joint payments.
This case shows us that a well-developed useful extra feature can be a strong competitive advantage and help you attract customers.
It’s quite a new technology but the name speaks for itself — shake your phone to find nearby users who do the same, and perform a payment. The list of mobile banking apps that offer this feature isn’t big and if you’ll be among those you could stand out and get the attention right from the start of your internet banking app.
🔐 How to Make a Mobile Banking App Fully Secure?
Statista indicated that 72.7% of Americans consider security and data privacy as their main concern for using a mobile app development for a banking sphere. That’s why the security of your app has to be on top.
So, let’s get to the point. How can you make your app truly secure for your customers?
Check out the list of security features that could come in handy while making a banking app.
# 1: Multi-factor Authentication
Just creating a complex password is necessary yet not enough in today's reality to develop a secure mobile banking app. Mobile banking app owners use _multi-factor authentication _to make sure data is under a layered defense. If the fraudster breaks one layer, then he has to break through at least one more, which significantly reduces the risk of being hacked.
Multi-factor authentication mixes two or more independent credentials:
- Security token.
- Biometric verification (fingerprints, face ID, voice recognition, etc.).
- One-time password.
- Phone call verification.
- Answers to personal security questions.
# 2: End-to-end Encryption
Every day thousands of dollars are transferred via a banking app. Because of that, a mobile banking app is a hotspot for hackers.
End-to-end encryption is something that solves the problem. Basically, end-to-end encryption (E2EE) is a system of communication and transactions where no one monitoring the network — not hackers, not the government, and not the company that facilitates your action — can see the content and details of the action done.
The best part about E2EE is that it doesn’t require expensive technologies, additional training, or staff. It’s simply provided by leading payment processors.
# 3: Device Fingerprinting
Attention! Don’t confuse the term with fingerprints as a biometric scanning.
Device fingerprinting is a way to combine different sets of signals of a device — what operating system it’s built on, browser type, screen size, IP address, location, time, language — to identify it as a unique device.
In the banking industry, it’s used for checking whether a person trying to enter an account is the person who’s the owner of that account based on whether they’re using a device or browser that has been previously used to log in.
Normally, if the device doesn’t get recognized, an owner gets a notification, text message, or an email with an alert of a potential fraud or hacker attack.
# 4: Behavioral Analysis
You might have noticed that sometimes you get a notification from an app saying “Suspicious activity has been noticed” or something similar. That’s all because you did an action that has never been done before while you’ve been using a mobile app.
You may see some similarities between this description and device fingerprinting, but while device fingerprinting tracks the device itself, behavioral analysis is aimed at your actions.
Such an analysis is implemented in an app via specialized software that monitors login location and online account activity.
Usually, the main key features needed for this analysis are:
- User recordings.
- Touch heatmaps.
- Real-time in-app analysis.
# 5: Real-time notifications
The list of mobile banking apps using this feature is quite long. That means it’s nothing extraordinary yet necessary.
The name speaks for itself — by providing users with real-time notifications and alerts (The amount of money spent/payment, “Log in” notification, use of another device notification in real-time, etc.), you inform your clients about current activities done in their account.
Many bank apps send notifications in case more money than a customer has set has been spent.
To make a real-time banking app notifications useful, turn them into alerts and send in case more money than a customer has set has been spent.
📖 Banking Regulations & Security Compliance Requirements
What’s specific about creating a mobile banking app is that your app must have security certificates and be in full compliance with international banking regulations or with those for a certain region/country.
Besides, every year new regulations enter the market along with new more advanced hack techniques. That’s why it’s of high importance to make sure that your app has some proven regulative protection.
We came up with a list of the most important moments you should pay attention to in order to create a fully secure online banking app:
- The processing of data has to be fair, lawful, and transparent.
- Data processing can be done for legitimate purposes specified explicitly to the data subject once you collect it.
- Data should be collected and processed only in an amount absolutely necessary for the specified purposes.
- Personal data should be kept for as long as necessary for the specified purposes.
- The process of data collecting and transmitting has to be conducted in a way that ensures appropriate integrity, security, and confidentiality (by using end-to-end encryption, for instance).
- Strong authentication system
- Regular updates of the systems.
- Systematic vulnerability scans and penetration tests.
- Security documentation and risk assessments.
As mentioned before, it’s hard to take it on trust that your mobile app is secure. To make sure that your services are trustworthy you should request appropriate security institutions to examine your app’s compliance with their regulations. Depending on the region you’re going to conduct your business in, you might need to be in compliance with these regulations:
|PCI DSS||Payment Card Industry Data Security Standard (PCI DSS) is an international security standard that provides a set of requirements (12) that are created to maintain a secure environment while processing, storing, or transmitting credit card information.|
|PSD2||Payment Services Directive 2 (PSD2) is regulation for electronic payment services in the EU. It’s a new version of PSD which is intended to help banking businesses adapt to new technologies, encourage innovations, and, naturally, make payment services secure.|
|GDPR||General Data Protection Regulation (GDPR) is an EU privacy and security law. It’s not specifically addressed to banking businesses and institutions, but they still have a lot to do with it. Regardless it was drafted by the EU, it works for organizations all over the world as long as they collect or target data about people in the EU.|
|GLBA||The Gramm-Leach-Bliley Act (GLB Act or GLBA) is a United States federal law that requires financial and banking institutions to show how they use and protect their clients’ personal information. To be GLBA compliant, institutions have to inform clients of their right to opt-out if they prefer their private data not to be shared with third parties, and implement specific protections to customers’ private data according to a written information security plan created by the institution.|
|KYC Requirements||Know Your Client (KYC) is a Canadian regulative document published by FINTRACK (Financial Transactions and Reports Analysis Centre of Canada) which lists methods of verification and requirement to verify the identity of an individual and confirm the existence of a corporation or of an entity.|
|APRA||Technically, the Australian Prudential Regulation Authority (APRA) isn’t a regulation, but an independent national authority that supervises institutions in banking, insurance, and superannuation industries and supports financial system stability in Australia. On their website, you can find various regulations and requirements regarding data security regulations for the banking industry.|
💰 How Much Does Mobile Banking Application Development Cost?
Here we will cover the average costs for mobile banking app development.
Bear in mind, they may vary depending on your personal preferences about the app’s structure, design, different technologies, and integrations.
Besides, the hourly rate of your development team impacts your expenditures as well. Our estimations are based on an average rate for Eastern Europe (45$ per hour). Take a look:
Thus, the rough cost to develop a banking app with mentioned features is between $18,000-$27,000. If you're looking for some extra features mentioned in the article, take a look at the table below:
|⚙️ Feature||⏳ Min Hours||⏱ Max Hours|
|📸 QR code scanner||16||20|
|✂️ Splitting bills||30||50|
|🔒 Multi-factor authentication options|
|Phone call verification||30||40|
Once again, this isn’t a final estimation. The number and complexity of features, technologies, and integrations as well as your development team’s hourly rate can change your costs.
Now you better understand how rapidly the importance of accessibility of an online banking app for any banking institution grows. Quick transactions, no geo limits, variety of payments (utilities, streaming services, mobile, etc.), beneficial commissions and satisfied customers — all of this can be reached by making an online banking app.
Of course, the process of developing is labor-intensive and time-consuming but the benefits you can get from it outweigh the costs.
Once again, we draw your attention to the security of your mobile app — it has to be on top not only for your customers but for you as well.
Looks like you’re all set and ready for your mobile banking app development journey. If you need an experienced Tech Partner to accompany you during your journey feel free to contact us and we’ll find the common way!