Banking Software Development Guide: Building the Future of Finance

At Neontri, we can see that the importance of banking software in today’s financial landscape is growing. It’s clearly visible, especially in the retail sector, where more and more businesses decide to implement banking services, such as Buy Now, Pay Later (BNPL) options, while banks embrace cloud systems, AI, and machine learning.

Banking software development services handle essential operations, including account management and transaction processing. Now, we can use different payment providers, digital wallets, or payment card aggregators. Such products help streamline payment processes, making it easier for customers to use their accounts and cards from various banks.

There’s no doubt that financial institutions need to develop and implement new features and services, such as mobile banking or AI, to keep up with the changing environment. What areas should banking software development address to keep up with the competition?

Defining needs

Each bank and financial institution has specific needs, clients, and possibilities. That’s why it’s important to find the areas that would most benefit from banking software development. You need to identify what can be addressed, whether refactoring, implementing new technologies, creating a fintech mobile application, or simply entering the market with a new banking software product.

New product

If you opt for a new product in the banking industry, consider finding a gap that needs to be filled for customers. This involves thorough research on what financial products are missing on the market or what kind of service customers need and don’t have yet.

Still, businesses and financial institutions need to decide whether to use existing solutions and technologies or develop new ones and leverage innovation. This requires in-depth knowledge of the market trends and a reliable partner who can help provide the solution of your choice.

Areas for improvement

If you already have a product, look for possible areas for improvement. Customer feedback can be a reliable source of information about what can be fixed, added, or removed. Direct customer feedback helps identify user pain points. Users often suggest solutions to consider when implementing changes to existing functionalities.

Nowadays, technology is becoming outdated quickly, so you can identify gaps in current software and fill them with new functionalities or improved user experience. Following new industry trends. e.g. mobile banking UX trends, and observing the competition will help you find the features your software lacks—for example, multi-factor authentication or moving to the cloud.

Core banking system upgrade

Banks that have been in the market for a while usually use legacy systems that are hard to update, slow, and inflexible. Handling new technologies may be challenging in such a case. Old systems may not support the latest functionalities, such as real-time transactions or mobile banking, keeping the bank way behind the competition.

Upgrading legacy systems is necessary when banks seek innovation. This is crucial for embracing the latest technologies, implementing new, competitive features, and, as a result, improving customer satisfaction and increasing loyalty.

Mobile application development

Mobile banking applications are undoubtedly very popular, and customers appreciate their convenience. Such apps are a great addition to web and traditional banking services. Mobile banking offers many benefits, including increased transaction security and expanded market reach.

Currently, most banks offer mobile banking services, so it’s necessary to maintain a competitive advantage. Having a well-designed and user-friendly app helps attract new customers and retain existing ones. Mobile app development is a way to adapt to client demands and stay competitive.

New technologies

Banking software development also enables adding new technologies to existing systems. To keep up with the competition, banks need to embrace the new and implement cutting-edge features for the customers, but also to improve their services in general.

The growth of the banking system may require updating existing software by introducing new technological solutions, such as machine learning, for real-time data analysis. Also, through new technology, banks can scale up as needed. Currently, the technological environment is developing rapidly, and adapting to these changes is necessary to stay competitive.

Timeframe and costs

Each development project requires proper expertise, time, and resources to meet the requirements. Banking software development involves expert knowledge of the financial environment, legal constraints, and technological possibilities. Depending on the complexity and project scope, the timeframe and costs of development may differ. Let’s look at specific elements that influence the two.

Development lifecycle

Banking software development has a lifecycle similar to that of general software development. It involves planning, design, development, testing and deployment. However, in the case of banking development, planning must include specific legal requirements and other constraints, proper security measures, and more.

If these elements are skipped in the planning stage, the time of delivering the product may extend significantly. Adding specific constraints and legal requirements later in the process may be hard and influence the time and cost of development.

Timeline and complexity

The time of development is strongly dependent on the project’s complexity. There are different types of projects that can be developed, such as mobile banking, online banking, banking tools, core banking systems, integration with new technologies, or adding new security measures.

If the project requires basic knowledge and implements simple changes, it may take only a few weeks. However, it may take a few months if an in-depth refactoring of the core system or a completely new solution is required. The MVP for a project usually takes, on average, 3 months.

The table provides an overview of the approximate time required to complete a specific project. However, it’s important to remember that each case may differ depending on factors such as complexity, technology, goals, team size, etc.

Project scope

A clear project scope is necessary for banking development projects. It should involve the following elements:

• Defining goals and objectives;
• Listing features and requirements;
• Stakeholder approval;
• Documentation.

All of the above should contribute to successful project development.

Development team size

An average team should include five to twelve members, but this number can be different for specific projects. Having too big a team may negatively impact communication, while too few team members may be unable to meet project objectives and deadlines.

Development teams often include the same roles, such as:

• Project manager or scrum master;
• Software developers with specific skills and knowledge;
• QA engineers;
• Business analyst.

Each role has specific responsibilities:

• Project managers and scrum masters are responsible for the software development process,
• developers take care of programming and implementation,
• QA tests the software,
• and business analysts connect business needs to technical solutions.

A skilled and experienced team will guarantee the timely delivery of the project.

Technologies

Since core banking software solutions are a specific niche, they require knowledge of finance-related technologies, requirements, and constraints. It’s necessary to involve specialists who know the banking regulations, financial software, and legal requirements, as well as security experts responsible for banking security considerations. Neontri, as a banking software development company, has those specialists on board and available for our clients.

AI in banking software

AI is one of the new technologies implemented in many fields, including banking and finance. Financial software development services use the potential of AI (artificial intelligence) to support the functionality of banking and financial systems. Artificial intelligence and machine learning can be leveraged for many benefits. These include:

• Improved fraud detection;
• Better customer experience;
• Cost reduction;
• Enhanced security;
• Tailored products for customers.

AI has multiple applications in the banking sector and is one of the top innovative solutions in financial data analysis.

Choosing the right vendor

Working on banking software is a serious endeavor, and finding the right partner to approach the development process successfully is necessary. The right vendor should have a deep understanding of banking regulations and specific technologies. Their expertise and experience should help you avoid risky decisions. Your cooperation should result in a high-quality product with proper support and maintenance.

Why Neontri for banking software development?

Neontri has over 10 years of experience in developing fintech and banking solutions. Our portfolio includes over 100 solutions for our clients from the banking sector. We know the banking industry well, including its complexities and challenges like regulatory compliance. Our custom software solutions, including the best mobile app, are used by millions of clients. We have a portfolio of enterprise clients, such as major Eastern European banks and payment providers.

Our technology expertise as a banking software company covers:

• data management;
• GenAI solutions;
• mobile app development;
• cloud services;
• third-party integrations;
• custom backend development.

These are just a few examples of our possibilities. Contact us to get a dedicated software solution tailored to your needs.

We’ve helped deliver the best mobile banking application in the world. Our certified developers, with over 15 years of experience, co-created a PSD2 hub connecting over 300 Polish banks with third-party providers. Our experience has allowed us to implement a transaction enrichment system for the biggest Polish bank. Our tailored solutions, like a powerful offloading system, can empower your business by attracting more customers and enhancing revenue.

Final thoughts

The growing importance of banking software in the financial services industry has led to the increasing need for banking software development. Nowadays, customers require cutting-edge solutions and choose banks that offer the most convenient functionalities.

This is why it’s necessary for banks to implement new technologies, such as AI, to keep up with customer expectations. However, to add new features, banks need to find a reliable partner for development. The key to successful development is having an experienced vendor like Neontri, who knows the challenges of the financial landscape.

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