Cost of Developing a Banking App: All Expenses You Need to Be Aware of

Increasingly people are making financial transactions online: brick-and-mortar bank offices have become a thing of the past as people can pay, purchase and transfer money with just a click. 

Due to this mass move to mobile banking, the fintech industry is gaining an extra boost with a mushrooming of multifunctional banking apps. 

The development of banking apps is very popular right now, and if you want to build one from scratch, you must first figure out how much it will cost. 

A fintech application can be built for as little as $15,000, but the cost can be higher if the app is designed to be a mobile banking app. 

What does a Banking App Mean?

Mobile banking apps allow customers to access their bank accounts directly from their smartphones or tablets and make transactions. Depending on the bank a customer accesses and the app’s function, such an app offers a diverse range of features. 

Besides credit union and bank mobile banking apps, other apps are also labelled as banking apps. Receiving and sending money is easy with other mobile payment apps. 

With these apps, users can deposit money into their bank accounts as well as send money to friends and family. Venmo, PayPal, and CashApp are some of the most popular mobile payment apps. Splitting bills can be easy and fast with these apps. 

There have been a lot of successes with peer-to-peer mobile payment apps over the past few years. Money does not reside in these mobile apps; they are merely a conduit through which money flows between banks. 

Banking apps could also be classified as FinTech apps. Big data helps users make better budgeting decisions with these apps that provide tools for taking control of their finances. 

Money flow and spending habits are tracked using expense tracking apps. In addition to syncing with bank accounts, these mobile apps do not store or handle money for users. Personal Capital, Expensify, and Mint are popular examples. 

In addition to helping users analyse their spending habits, these mobile banking apps provide retirement planning and more. 

Most banking apps provide the following features:

• Authorization
• Keeping track of your card’s balance, current transactions, and current transaction history
• Transferring funds between individuals in a secure manner
• Payment scheduling 
• Bill payment
• Getting a new credit card or opening a new account

A banking app MVP should have these features. Despite this, some extra features will help you to get to the top of the market given the pace of industry development and high level of competition within the niche: 

• Scanning QR codes
• Providing cashback
• Apple Pay and Google Pay one-click integration
• Service bookings through third parties
• Sharing bills (for example, when a group of people dines together)

A Banking App’s Cost is Affected by What Factors?

The cost of building and launching a banking app is an integral part of the budget. To determine the exact cost of developing a banking app, multiply the number of hours necessary by the developer’s hourly rate. 

The formula below shows how it’s typically calculated: multiply the number of hours needed by the developer’s hourly rate.

Besides the actual development costs, the total budget also includes post-release costs like customer support and marketing. 

It depends on four main factors how much it costs to build a mobile banking application: 

• The complexity of the app: In addition to the number and complexity of features, development costs are directly affected by the number and complexity of features. An MVP costs half as much as a scaled product if you build it first. 
• Tech stack used: Development costs are also affected by programming languages, libraries, and APIs. Some apps require specific skills and programming languages that go beyond the classic approach to app development.
• Team location: Comparatively, developers in the US charge around $100-150 per hour on average, while outsourced development services from India cost about $20-30. 
• Cooperation type: A freelancer’s price is significantly higher than that of an in-house team. The former is relatively cheaper, but working with freelancers involves quality-related risks. 

A Banking App’s Key Features: Costs and Time

A mobile banking app’s core features can be developed for the following price and time (prices are based on US market prices):

• Authorization (sign-in)

Registration and authorization are the first steps in every app. A password or biometrics check (such as Touch-ID or FaceID) should be used for authorization.

• Data access to cards

Card numbers, balances, owner’s names, payment systems, and account information should be accessible quickly to users. This feature can also provide card-related services, such as reissuing cards.

• Payments and transactions

Funds have to be sent and received in an intuitive, secure, and easy-to-use way. It is usually necessary for users to confirm transactions using biometrics, SMS codes, or typing their passwords.

• Histories of transactions

All connected bank accounts should be accessible to users. In return, you are getting a better user experience if the report is more detailed.

• Analyses of spending

Users can use this feature to analyse their financial behaviour and set financial goals using mobile banking apps. Savings goals, budget categories, and customised reports are often part of the functionality.

• Alerts

In the development of mobile banking apps, this is an important feature that allows users to be notified about transactions, required authorizations, or special offers. 

• Customer support via in-app chat

To clarify any issues you may have, you can quickly contact technical support, a chatbot, or your bank manager.

A Banking App’s Extra Features: Costs and Time

Now that we know both how long it takes and how much it costs to develop basic banking app features, let’s look at some additional features you can include:

• Scanning QR codes

More than 27% of US and UK users preferred QR-codes as a payment method in 2020, according to Statista. To ensure fast and secure payments, integrate QR codes into your banking app development.

• A cashback program

One of the most popular features of this app is the ability to get a certain amount of money back. Developers of mobile banking apps often set up several cash back categories and allow customers to place returns in separate accounts.

• Incorporating payment methods in one click 

To increase payment conversions and maximise user-friendliness, Apple Pay and Google Pay integration are essential. 

• Service bookings with third parties

The development of mobile banking apps often includes convenient features like this. You enable users to buy tickets, book hotels, and so forth without leaving the app by providing access to third-party services. 

• Bill splitting

A “splitting bills” feature makes routine transactions more convenient. For example, everyone pays their share when dining with friends in a restaurant and there is no debt repayment involved.

• Offices and ATMs

A search for ATMs and bank branches near you will be made easier with this feature. The feature is enabled by integrating Google Maps or Apple Maps for Android or iOS, respectively. 

• The cost of security

Developing mobile banking apps requires a high level of security. The future banking app development roadmap should have a separate section dedicated to security issues. 

A third expense within the development process is ensuring that the app’s transactions and data are protected using the latest technologies. 

• The time limit for sessions

It is important to remember that the cost of different security features greatly varies depending on the amount of time and effort required for development and integration, as well as the type of technology used. 

Maintenance Costs: What are they?

Banks are concerned about maintenance and security. To ensure the user’s money and bank account information is protected, FinTech apps require ongoing maintenance. 

Mobile banking apps that send, receive, or hold money for users can easily cost six figures in annual maintenance. Annual maintenance costs vary depending on your user base, application complexity, and data access. 

A mobile banking application’s maintenance costs are high because it is important to ensure a quality, safe, and reliable user experience. 

You may lose your entire business if your customer data is compromised in any way. Therefore, FinTech companies invest heavily in preventative maintenance measures to keep their apps and users safe. 

Bottom Line 

Surf is committed to best practices in developing mobile banking apps and always considers clients’ goals, aspirations and challenges when developing these apps. Among our latest industry projects is the first version of the new smart-bank app. 

As part of our project, we were tasked with creating the first version of the new smart-bank app, which they would then be able to develop and upgrade in-house. 

We have successfully developed a banking app on Flutter (the first banking app to be built on Flutter in Europe and the second to be written on Flutter in the world). This will enable the in-house team to manage the app more efficiently and reduce costs. 

In addition, Surf’s team was able to combine the old backend with the new app by creating a middleware server, ensuring seamless user migration from the old to the new app, enhancing the app’s design, and preparing the ground for future app development.