Banking is a compelling example of an industry that has been both disrupted by technology and retained its distinctive heritage. Physical and digital banks now compete for customer service, international banks make it easy to send money across countries and oceans, and people can opt for accessing banks on their own terms as remote verification and appointments are now possible — these are just a few examples of banking in 2023.
Right now, banking apps make up a significant proportion of the multi-billion dollar financial technology (fintech) category of apps. On a user level, people rely on their phones for everything and this carries over to how they hold, handle, and invest their money. On an average day right now, around two in three Americans use a banking app to complete a task or purchase and fintech companies are responsible for almost 40 percent of personal loans granted in the U.S. So much goes on in our banking apps!
A point of consideration for both everyday people and technology professionals is whether banking apps can be designed and developed in a way that saves customers money. In this blog article, we’ll analyze and review this in terms of:
We’ve already touched on how much of our financial activity happens in banking apps now. This is because these apps are:
Statista summarizes these advantages in their own report as being qualitative and quantitative. “On the one hand, it provides customers with an easy and fast way to conduct banking operations, allowing them to avoid visiting banks’ physical branches,” They say before elaborating further, “Moreover, as more and more customers conduct their banking operations remotely, banks can decrease the number of physical branches and reduce maintenance costs.”
Basically, banking apps are changing the way we bank through the generalized customer service experience and they’re also investing in the user experience (UX) through technology. Upgrading in-app features, userflow, and functionalities constantly enhance and elevate how the user is managing their banking product, that they are paying for via fees, and this is now part of how banks compete with one another. Mobile banking is now an enticing value proposition for banks when they are converting people into customers; furthermore, app-based banking is statistically more secure than web-based banking.
Overall, functionality in mobile banking apps is the key benefit for users as these products are part of how we get things done, manage our affairs, and protect our assets these days. A recent study from Forrester Research also found that U.S. bank customers believe they should be able to accomplish any financial task on their mobile device. The takeaway is that mobile apps are a positive part of how we do life though there is an expectation hat technology will get better with more robust, loaded, and reliable applications.
Now that we’ve reviewed the essential value of banking apps, it is worthwhile to extend our analysis to how banking and non-banking apps differ. After all, how much can they vary?
The general market consensus on internet traffic is that people opt to complete most of their online activities via mobile devices and apps. Nevertheless, banking apps do tend to vary from other apps based on two predominant UI features:
Even with these differences, nearly all mobile app developments will have similarities and it is just the actual interface features, functionalities, and power of the product that will be different. Our analysis shows that these are more characteristics that set banking apps apart from non-banking apps; there are other popular apps, like YouTube or TikTok that handle a high volume of traffic and rich media, that have another kind of robust functionality that a banking app won’t have.
It’s now time to look at the more detailed features of every banking app — the key UX and design elements that enrich the customer’s experience. A successful app that delivers on functionality and feel should always be:
These features are a standard baseline for any high-quality banking app. Although users typically don’t pay for their apps — these could be extrapolated from bank fees and the bank’s operational model — there is an urgent need for all banks to offer a product that has an exceptional UX and modern, streamlined design. In the case of digital banks that have made their mark via their app-only product, these technical product features and their banking infrastructure are their unique value proposition. Traditional brick-and-mortar banks and financial institutions are keeping up with the competition by virtue of the standard of their digital product and their in-person offering of face-to-face customer service and suite of banking products. The
Interestingly, one study from Forrester Research indicated that banking interfaces aren’t even close to what they could be despite how pivotal the UX and design interface are to customers. Peter Wannemacher at Forrester explains, “The upper limit for how much functionality can exist within a mobile banking app is far higher and much bigger than most banking executives realize.” Their research of banking apps found that ‘super apps’ are in demand from many customers who desire the “digital ecosystem” of products and services within one app. At present, PayPal is working towards this model and Alipay is already well-known in China; conversely, there are experts who argue that it isn’t completely necessary if the existing bank app is meeting customer needs and they’re satisfied.
Mobile app developers work in collaboration with banks to develop products that help users get their money management sorted with minimal trouble, plus it’s opening up banking to more people all over the world. So far, we’ve assessed the standard UX and interface requirements that are a requirement of any successful banking app. Now, we’re going to explicate the following seven ways features of the banking app interface and UX actually build better financial outcomes for everyone:
Making information accessible makes education a default feature of the UI and design elements can reinforce the way the user can take this to inform their spending, saving, and planning choices. Often information is hidden, difficult to find, or its value isn’t properly conveyed to users. This is especially detrimental to both the user, the bank behind the app, and the developer if all other components of the app are in their favor. There is a saying that ‘knowledge is power’ and it’s true in the case of financial literacy. People need to clearly understand and be able to effortlessly refer to the statistics, patterns, and events in their finances.
Making information accessible is simple. Developers can situate high-level information for users in two ways: up front as part of data round-ups and as part of clearly defined frequently asked questions. Then, as part of communication with the user and the design of the app, they can receive prompts that refer to this information. Normalizing access to this when they use the app, both actively and passively, sends the message that this is a relevant part of the banking service and it’s relevant to them personally.
In our discussion so far we have touched on security features a number of times. This is because account security is vital to any person’s digital activities and in the case of banking apps, any data or assets being compromised can be completely devastating. A secure interface is comprised of three parts:
These parts all serve to cultivate an app that in all areas protects the user, their identity and data, and their assets. Over time, this may well save them money and have a reciprocal impact across all of their accounts and areas of personal security.
More and more people are using their banking apps for travel and international purchases. Both of these can involve international currencies with associated conversion and transaction fees. Developers can work with banks to offer a range of currencies so that users can store currencies and toggle between different options depending on their needs. Neobank Wise who started as a currency transfer service and are now a bank have pioneered this with a powerful, modern interface that enables lower cost international transfers between banks in seconds. Giving users clarity around their international transfers helps with managing funds and this is an invaluable tool for travellers who can spend from their app without needing cash which saves money.Other neobanks like Revolut deliver an app-based multi-currency bank service that works across the UK and European Union, too. Having banking apps that can hold multiple currencies saves users money as it gives them an option to spend in different currencies as a default. Often it’s confusing to choose which currency to pay in particularly in an on-the-spot scenario. Bank apps frequently have a better rate than the merchant or at an ATM. Where possible, being able to refer to the app’s rate for the currency helps people make an informed decision about the rate that offers them a better deal thus saving them cents or similar on the relevant currency.
We’ve previously touched on education as part of saving app users money. Specific UX features that deliver users prompts and push notifications about saving and spending can help with thinking more consciously about financial decisions. In the hands of a developer, these prompts and push notifications can be designed with user-centric tips and tricks or they can be more generalized to suit the bank’s identified range of recommendations they’ve assembled to assist their customers.
There’s a chance that these prompts and push notifications could be perceived as annoying so designing the format takes a deft hand. Maintaining a schedule of themed prompts and push notifications can intrigue users and feel interesting. If these are combined with facts about spending habits and saving strategies, it also brings the user onboard. Some banking apps can also gameify the user’s spending habits, such as if the prompts suggest saving money for a day or even designing a challenge for the user to complete a saving freeze for a ‘streak’. If the bank is able to offer a limited incentive with the challenge prompt, this might be the boost for the user to save money they had otherwise not felt able to.
One of the most intriguing and effective ways to promote behavior changes is via color psychology. In the UI and design elements, developers can work with the bank behind the app to uphold their branding while also designing the userflow for certain outcomes. Colors have different symbolism in cultures and contexts so the design might be to prompt decisions, assess others, and even stop and consider before a high-value purchase or transfer. Obviously colors like red are associated with ‘stop’ whereas green is associated with ‘go’, however there’s scope to even adopt a color scheme for the entire app that uses colors for just some actions and preserves other colors for authorizing. Giving users the chance to customize their color scheme in the UI may help cultivate their own sense of control around their spending and personal goals. Offering this during set-up or as a pop-up that says “Need a change?” proposed with the benefits of trying something new are all parts of color psychology, too.
Verification is a fundamental part of security for obvious reasons — it creates a necessary blockade to stagger the outcome of access to accounts. Verifications steps for transfers and purchases introduce the same ‘stages’ function to the UX. Building these stages around transfers and spending can include requiring users to authorize purchases via the app if they’re buying in another window or even setting a maximum daily spending limit that can only be overcome via manual authorization. Developers integrating these features into the development process are designing the userflow so users think more about their actions and even with the more time-consuming angle, this has positive returns for them. People often complain about how digital purchases can feel like mindless spending and these app features make the everyday more thoughtful. Users could even opt-in to a system that let’s them save purchases for later or freeze the money, just like the gameifying mentioned in 4., if they are using the app as part of their money-saving strategy.
Lastly, developers can situate features like scheduling payments and money management tools in the foreground of the app interface. Helping users get organized is another branch of positive psychology for anyone struggling with gaining a sense of practical control around their finances. These tools can be selected as a way to design, implement, and uphold goals over a set period of time or simply as part of their individual UI. One side of these tools is scheduling as money-saving tips regularly nominate the value in planning out debits as soon as people’s pay is deposited into their account. This structures out how they uphold their financial commitments and build momentum around their spending. The other side is money management features that help the user categorize and sort their money into their preferred sub-accounts so they’re not working from just one pool of funds. If developers make banking apps both about storing their assets and tactically managing them, the logical flow-on can be saving money.
In closing, banking apps are designed to help people manage their money well. This has a highly personal definition for every user based on context, spending habits, and how they use the financial tools — like banking apps — available to them. Interfaces that prompt organization, security, insights, education, and long-term financial planning are driving money saving through convenience, infrastructure, and accessibility.
A key aspect of personal finance and investing is evaluating the time horizon for financial activities. Banking apps are designed to deliver to this customers in an empowering way that puts control quite literally in their own hands. The ongoing preference for banking apps over traditional personal finance models suggests that the synthesis of technical features and psychology nurtures a dynamic UX that can result in measurable savings. As neobanks retain their market position, it’s safe to say that the forecast for this market is digital products that deliver on a revolution to how individuals bank and the industry operates. David Curry writes for Business of Apps that, “The financial sector has not been adverse to technology, however the monumental push in the past decade by technology startups to disrupt financial sectors, spurred on by governments slackening regulations, has left established businesses struggling to keep up.” This is an industry that will keep evolving and with technological advances as part of this and ongoing innovation in mobile app development, these products will keep growing in power and personal financial gains.
Banking apps fall under the mobile app category of fintech.
Fintech applications include the following niches:
Banking apps are typically used to manage personal funds via a bank or financial institution including credit unions. Banking apps are upheld by traditional banks and institutions and neobanks that are often digital-only, often functioning solely via their application banking product.
Some banking apps function as a fintech app that includes a range of additional features that a bank might have incorporated into the one app product. These could be described as a ‘super app’ based on the scale of functions and features for users.
Banking apps are amongst the most disruptive of technology markets. Though banking institutions, traditional physical financial institutions, are among the owners of leading banking apps it is not a requirement in order for a banking app to be designed with mobile app developers.
Neobanks are an example of how fintech includes financial start-ups that offer specific application-based services to customers.
Every region has its own banking laws, therefore for a banking app to be deployed to market — to the App Store and Google Play — the company and their application will need to adhere to the relevant laws of the region of operation.
The UX and design of the application is imperative for developers of bank apps.
The most important UX and design features are:
Based on high-level development and users adhering to security protocols, the security of banking apps can be preserved.
Typically, banking apps have a robust back-end that is coded for high-level security and the user interface (UI) is designed to require customers to adhere to strong cybersecurity frameworks: multi-factor authorization to authenticate user credentials with complex passwords.
Mobile apps are statistically more secure than web apps as they use integrate with the mobile device’s security features. Even with these characteristics, effective security is reliant on:
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