How much is the cost of building a banking app? The question is vital, if you plan to create a completely new one. This article will provide insight into some major factors influencing your investment and give you an estimated price tag for giving life to your fintech product.

In a world where an incredible number of financial operations take place online, the traditional brick-and-mortar bank is fast becoming obsolete. The shift to mobile technology has spurred a rapid expansion in the finance industry with numerous apps offering more online features than ever before and creating some stiff competition.

What is a banking app, and how does its cost depend on functionality?

With a banking app, users can easily stay on top of their finances with the touch of a finger: from checking balances online and making deposits to transferring money between accounts. Getting connected on-the-go today is easy and financial control depends on a set of features offered by every specific bank.

Below are several classic online features provided by most banks that all users know and use online:

• Authorization
• Card info, current balance, and transaction history
• Secure person-to-person transfers
• Scheduling payments 
• Paying bills
• New account/card

Basically, we know, this set of features is enough for banking MVP and will help you minimize the costs of creating an app. However, given the pace of industry growth and high competition within the niche, some extra online features will help to bring your app to the top positions in the market: 

• QR code scanning
• Cashback service
• One-click payment methods (Apple Pay, Google Pay)
• Booking third-party services
• Splitting bills 

What determines the cost of developing a banking app?

Building and launching a banking application takes both time and money. To know the exact cost for development, you need to consider two key factors – how many hours of work will be needed from developers, multiplied by the rate those developers charge per hour. All of this comes together as a basis of your total budget expenditure when constructing an app.

The total application building cost also covers post-release costs like customer support and marketing, and additional expenses beyond the actual developing activities (analytics, designing, testing and management). 

The cost of mobile banking product creation is conditional on four main factors: 

• The scope of online features and their complexity level. When starting out, building the necessary features in your Minimum Viable Product or MVP can cut costs significantly compared to creating a full-scale version right away.
• Tech stack used in creating bank and finance solutions. The costs of building depend on choice of programming languages, libraries, APIs.  Programmers often choose native approach and use Swift for the iOS platform and Kotlin for Android. But some applications require specific skills and programming languages that go beyond the classic approach. Java is also frequently used in fintech due to enhanced security and cross-platform capabilities, while Ruby on Rails is gaining momentum thanks to high storage database.
• Geography of the developers team. Before you decide for an agency to outsource development services, compare the average hourly rate of developers in various regions. For example, in the US it is around $100-150, while in India, you will pay about $20-30 per hour. 
• Collaboration model. The costs of building an application differ significantly if  you hire an in-house team or use freelance services. While the latter is relatively lower, it implies quality-related risks.

Primary features of a banking application

Let’s look at the price and amount of time needed for building core features of a mobile application for a bank or startup (values are given for the US market):

Sign-in (authorization)

Users start interaction with online products with registration and authorization. Both should be in line with industry-specific security standards (verifying password or biometric check like Touch-ID or Face-ID).

Access to card information

The next thing the users expect is quick access to all data they need to know: card details, balance, cardholder name, expiration date, and account information. Additionally, the feature set may include card-related services, such as card re-issuing.

Transactions and payments

Today, the users are on first-name terms with the technology and they expect a possibility to send and receive money online easily, securely, and intuitively. The transactions are as a rule confirmed either by biometric verification, an SMS with a code or by entering the password.

Approximate time required: 480 hours

Approximate cost: $48000-72000

Transaction history

Users should have access to the whole spending history from all the connected bank accounts. The more detailed the report is the much better user experience and user loyalty you are winning. 

Spending analytics

Within the functionality scope of the mobile financial product, this online feature helps users to analyze and adjust their financial results with the help of budget categories, customized reports, saving and setting goals. Here the developers should work much with UX designers to make functional and descriptive online charts and diagrams and this can also influence the costs of designing an application.

Notifications

To inform users about everything they should know, the scope of creating a mobile banking app, provides for notifying them about transactions made, bills to be paid, or special offers. 

Approximate time needed: 120 hours

Approximate cost: $12000-15000

In-app chat with customer support

Easy way to quickly get in touch with technical support, chatbot, or a personal bank manager to tell about any issues arising and get them solved.

Let’s summarize the basic costs for developing banking application:

Basic feature	Approximate time  needed	Approximate cost
Sign-in	480	$48000-72000
Access to card details	240	$24000-36000
Transactions and payments	480	$48000-72000
Transaction history	240	$24000-36000
Spending analytics	240	$24000-36000
Notifications	120	$12000-15000
In-app chat with customer support	480	$48000-72000
TOTAL	2280	$228000-342000

Extra features of a banking app: time & costs

Since time and the approximate costs of building application with  basic features is identified, let’s review some additional features you can add:

QR code scanning

According to Statista, more than 27% of users in the US and UK preferred QR code as a payment method in 2020. Include QR code in your feature list to ensure fast and secure payments.

Cashback service

It is known as one of the users’ favorite features that allows getting back a certain amount of money spent. Mobile app developers in the bank domain usually set several cashback categories and allow placing returns on a separate account. 

One-click payment methods integration (Apple Pay, Google Pay)

It’s true that one-click payment methods are taking over the world, that’s why the integration of Apple Pay and Google Pay is the key step to high payment conversion and maximum user-friendliness. 

Approximate time needed: 480 hours

Approximate cost: $48000-72000

Booking third-party services

Another convenient feature, which is often included while creating mobile banking products to uplevel the app. By adding access to such services, you enable users to buy tickets, book hotels, and so on without leaving the application. 

Approximate time needed: 480 hours

Approximate cost: $48000-72000

Splitting bills

“Splitting bills” is a feature making routine transactions more convenient: no debt repayment when you are having dinner with friends in restaurants, everyone knows their share and pays themselves. 

ATM and office locations

This feature is set to make the search of ATMs and bank branches nearby easier. To enable it, mobile developers integrate Google Maps or Apple Maps for Android or iOS, respectively. 

Approximate time needed: 120 hours

Approximate cost: $12000-15000

To sum up:

Extra feature	Approximate time needed	Approximate cost
QR-code scanning	120	$12000-15000
Cashback service	240	$24000-36000
One-click payment methods	480	$48000-72000
Booking third-party services	480	$48000-72000
Splitting bills	480	$48000-72000
ATM and office locations	120	$12000-15000
TOTAL	1920	$192000-282000

Security costs

It is a well-known truth that security is paramount when it comes to protecting any mobile financial app. To ensure that your mobile banking product will remain secure, create a distinct section of the roadmap devoted specifically to security issues and budget for additional measures like incorporating recent technologies and proactively monitoring transactions/data stored in the application. Bringing these protective strategies true to life now can save major headaches down the line:

• Biometric data
• One-time passwords to confirm user’s identity
• Risk-based authentication
• Password check (to avoid too short and simple ones)
• Limited session time

When considering security features for your project, bear in mind that the cost of implementation can be affected by both how long developing and integrating take, as well as which kind of technology is used. 

Final word

Surf is dedicated to building the best mobile banking apps and always considering clients’ needs, goals and obstacles. We proudly achieved our goal of creating a new smart-bank app powered by Flutter, which then would be taken by our Client for in-house developing and upgrading.

Surf has successfully built it on Flutter (the first banking application on Flutter in Europe and the world’s second one written on Flutter), thus enabling developing much faster, reasonable lowering of production costs, and easier app management by the in-house team in future.

Surf team has managed to put the old backend and the new frontend together by creating a middleware server, ensure seamless user migration from the old app to the new one, polish the design, and lay the ground for effective further evolution by the Client’s team. So if you want to estimate the  costs of creating your bank or startup fintech project from scratch, fill the form below, tell us about your idea,  and get a free consultation from Surf experts.