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Mobile Banking App Development: Best Practices & Costs

11 Mins read

Most people still ‘bank’ in an old-school traditional way with frequent visits to the departments, cumbersome or expensive P2P money transfers, and the unmistakable fragrance of bureaucracy. Though there is still some style to traditional banking due to its exquisite institutional posturing, old buildings with classical tang, and ages-long history of intricate financial manipulations, people’s views and desires shift towards the magnetic convenience of mobile-only banking apps. And for a reason: mobile banking is intuitive, user-friendly, and doesn’t require you to spend time trying to figure out ‘How? Why? When should I do this or that?’ No wonder the number of people who want to shift towards digital banking is growing so fast. So, now — is just the right time to enter the fintech market with your own mobile-only banking app and help to shove traditional banking a little further down into obscurity.

In this article, you will learn about mobile-only banks, their functionality, pros and cons, the process of mobile app development for banking, associated security concerns, and bright examples of successful digital banks. 


1. What is a Mobile-Only Digital Bank?

2. Pros and Cons of Mobile-Only Banking Apps

3. Features of Mobile-Only Banks

4. Best Practices of Banking Application Development Process

5. Importance of UX for Banking Apps

6. Cost of Developing a Mobile Banking Application

7. Digital-Only Banking App Security

8. Examples of Mobile-Only Banking Apps

9. Conclusion

10. FAQ

What is a Mobile-Only Digital Bank?

No need for elaborate explanations — the name speaks for itself. Mobile-only banking is banking for which a user requires only a smartphone with the installed app. All operations, transactions, monitoring, and other user interactions are performed via the app. Basically, a mobile-only digital bank is a bank at your fingertips. Banking cards are still present, though, so users can withdraw cash using ATMs. 

Mobile-only banking apps strive to emulate real banking experiences but make the latter as convenient and fast as possible. However, different apps may introduce different features and pleasant bonuses that set them apart from the competition. Digital banks come in great variety, and there is pretty much no one-size-fits-all mobile-only bank solution that will satisfy all users. The variety of options means that customers can choose a digital bank they think is the best for them. It also means that there is always free space for digital bank contenders who aren’t afraid to try something new. 

Here are the things you need to consider before starting your mobile-only bank.

Pros and Cons of Mobile-Only Banks

So, mobile banks are great and convenient, but to what extent exactly? What are the advantages and disadvantages of using digital banks? 

The picture shows pros and cons of mobile-only banking apps

Pros of Mobile-Only Banking Apps

Omitting the obvious benefits of convenience, 24/7 access, and minimization of bureaucracy, mobile-only banks have the following pros:

  1. Easy to set up and start using

It’s criminally easy to become a user of a digital bank and start indulging in its convenience in comparison to traditional banking. For example, with most digital banks, it is as easy as downloading the app, registering, verifying your identity, connecting a money account, and starting using the app even before you’ve ordered a physical card. Ordering a physical card is also easy as one-two-three, after which it will arrive to you as soon as possible.

  1. Fewer and lower fees

Digital banking does not have to deal with the humongous bureaucratic machinery, which means lower overhead costs. The latter allows digital banks to implement fewer and lower fees because they don’t need as many income sources.

  1. Smooth user experience

Mobile banking is extremely user-centric. The apps are created to make a customer feel like a king of their own little financial kingdom with 24/7 customer support, a variety of banking operations that are a few finger taps away, intuitive user flows, impeccable user interface, and appealing design. If a good digital bank can’t make a user feel happy and special, then pretty much any financial service provider can’t as well.

And the Cons of the Mobile-Only Banks Are

  1. Security concerns

The overall convenience and immediacy of digital banking have its downside — security. As far as all operations are performed via the Internet, a high-quality online banking app should have bulletproof and foolproof security, so a user can trust the app every time he or she presses a button ‘send‘ or ‘submit.’ Nonetheless, the silent voice at the back of a user’s head that reminds them about the vulnerability of the personal data and money may never go away. However, as the software evolves and people change their views, this issue slowly diminishes.

  1. No Digital Bank ATMs

Mobile-only banks don’t have their ATMs and have to rely on partnerships with other banks. However, the latter is not always there. Therefore, sometimes the only choice is to withdraw cash using an ATM that charges significant fees.

  1. No human-to-human interaction

The absence of the possibility to come to a bank and talk to a real consultant or a teller may result in the lack of flexibility regarding services and transactions. And, hey, live interaction with another human being may be a pleasant experience, even if it’s a completely formal event. Especially now, in the era of social media.

Features of Mobile-Only Banks

A well-rounded mobile bank should have the following core functionality:

The picture shows main features of mobile-only baning apps

Financial operations 

First and foremost, a mobile-only bank acts like a digital wallet and a bank account, which helps to store a customer’s money, monitor the balance, transfer money to other users quickly, make deposits, pay for stuff online and in stores. On top of that, the mobile-only bank may provide small loans, set overdraft limits.

Secure interaction

Multi-factor authentication, end-to-end encryption, secure back-end architecture, foolproof UX, and best coding practices that help to avoid weaknesses in the software’s construction should make the mobile-only banking app a digital fortress. Security should be the first concern while developing an app, and the last concern, basically an alpha and omega of mobile-only banking app development.

Engaging User experience

Unlike traditional banks, their mobile counterparts should be fun to interact with. Customizable user experience, timely notifications, gamification with achievements, and flawless UX will help you to achieve this goal.

24/7 Customer Support

If it’s a digital bank, be ready for customers to have many issues they want to resolve ASAP. You need to have proficient and, what is more important — stoic — customer support in place that will be able to handle the surge of worried customers with ease, so the credit of trust the users have to your app lasts.

Best Practices for Banking Application Development 

Step #1: Market Research 

Learn your primary competition, their strengths, and weaknesses to develop your unique value proposition and adopt the best practices from successful banking apps. 

Step #2: Build a Prototype

To envision the future application and work out the user flow, create a prototype with app logic and design components. 

Step #3: Consider Security

One of the most common practices for a banking app is implementing DevSecOps into the development pipeline. 

Step #4: UI/UX Design 

Based on the prototype and the feedback from it, create design elements that will deliver a great customer experience and make your application useful and safe. 

Step #5: Decide on the Technology

Depending on the budget and business goals, choose the right tech stack. It is recommended to consult with an experienced software development company that can help you make a data-driven decision. 

Step #6: Start Coding

If you have the in-house resources, you can start mobile banking application development by yourself. Alternatively, find a software development vendor with proven experience in fintech. Peruse their portfolio, ask for a meeting to learn more, and make sure the company is competent and trustworthy. 

Step #7: Test and Release

Insert testing activities as early in the pipeline as possible and make sure the application is secure and fast before releasing it to a broad public. 

Step #8: Update

Collect feedback and integrate helpful insights into new features and releases to cater to your audience’s needs and wishes.

Importance of UX for Banking Apps

Interactive Banking Experience 

Your banking app should feel as interactive and engaging as possible. In the abundance of modern apps, including banking apps, your users have to enjoy interacting with the application. There are dozens of ways of making banking applications interactive and fun to use: 

  • Interaction with content. 

Provide an opportunity to share and like content within an app and to social media. And make sure the content is creative and relevant which will significantly boost user experience and entice your clients to interact with the app longer. 

  • Easter eggs. 

Easter eggs are clever and rewarding hidden features that add depth to the application, give users the possibility to feel the joy of discovery, and show that developers had fun creating this piece of software. 

  • Gamification. 

Gamify the banking experience for your users by adding bonus systems and achievements. For instance, the application can reward users for hitting their savings goals or limiting spending or even buying healthier food. The only limit is your imagination. 

  • Notifications for different purposes. 

Add little notifications about interesting relevant events or facts as well as financial tips for the users. When users hear the sound of notification they should feel the urge to open the app and read the notification, and not just ignore it out of frustration. You need to be careful with alerts as average users receive a ton of them, so make sure to keep them engaging and helpful.

  • Video content. 

Integrate video messages about updates and other important news. Text is fine but video content will expand the user experience. All in all, the human voice impacts us on a deeper level than plain text. Video messages should not be too long and just contain one central message.

  • Humor. 

Also, do not be afraid to spice up in-app messages with some light-hearted humor. Nobody benefits from excessive formality (except Vogons).

Intuitive Banking Experience

Modern app users are so accustomed to seamless and intuitive experiences that they will not waste their time looking for hidden monthly spending reports. The complicated online banking experience is arguably among the top most frustrating things to deal with during the Internet era. Your banking application should be intuitive and convenient. Therefore, ensure that the financial software has:

  • An adaptive interface. 

Each person is unique, so it is impossible to create a “universally convenient interface.” Therefore, we should use software’s abilities to “learn” based on user activity. For instance, the banking application should make the options and products that the client uses more often easily accessible from the main screen. It is always pleasant to experience how some aspects of the world adapt to you. However, the screen should not be overloaded with various elements and display essential information and elements.

  • Laconic screen. 

The screen is not overloaded with information and displays only essential bits at a time. Also, information like balances of accounts in different currencies, options to refill an account, and information about transactions should always be easily visible and accessible.  

  • Smart transactions.

The banking app should display different information depending on the type of transaction. For example, a transaction should have the possibility to make a split bill, tabs with debts, exchange rates, etc. 

  • Synchronization with other services. 

For instance, your banking application should automatically download information for a transaction about the bank’s users from the contacts list on a user’s phone if there is a required person.

Customizable Banking Experience 

Give users tools to make the banking app their own. Self-expression and flexibility are extremely important to our audience, and the application should not hinder these values. Thus, the online banking application should:

  • Have an adaptive interface.

Ensure that your application has enough custom options to make the interface their own.  

  • Give an option to adjust the design. 

A user should have the possibility to change the colors and preferably fonts. It will allow users to individualize their banking application as well as help color-blind people who have unique color preferences. 

  • Have bonuses and achievements. 

They also help to individualize banking applications by allowing people to create personal financial goals and reward them for reaching those goals. 

  • Be a personal financial advisor. 

Modern online banking should not only serve but assist users in managing their finances. Therefore, the app should have a possibility to determine limits on certain products and services and monitor spending in addition to a casual display of expenses per category. It will help users control their buying habits and save more money. In addition, you will always have a possibility to improve the app’s financial advisor with smart algorithms that will help clients analyze the budget and provide valuable insights.

 Cost of Developing a Mobile Banking Application

The costs of mobile banking app development depend on the app complexity, the number of features, and the location of the service provider. For example, the average hourly rate of a developer in Ukraine is about $40 to $60, whereas developers in the US earn at least $130 per hour. As a result, you will save more than 50% of the budget simply by recruiting an Eastern European software development company. 
App complexity is a more difficult topic as it depends on the app idea, features you would like to implement, and scalability. The costs of banking app development lie somewhere between $100,000 and $500,000 and can expand even more with increasing complexity. Software developers at Kindgeek have successfully delivered multiple banking applications and can share their expertise with you. Contact us to receive a free consultation and learn how much it could cost to develop a mobile banking app that is fruitful and useful.

Digital-Only Banking Security 

Digital-only banking security is a pain in a well-known place. However, if you are prepared and have a well-prepared tech team, a secured app is simply a matter of time and investment. We wrote a tight article on security in fintech; the basic principles are the same. 

– Develop reliable system architecture 

– Write reliable code with reliable project logic. 

– Conduct a thorough quality assurance (QA) phase 

– Add multi-factor authentication

– Use end-to-end encryption

– Use secured web access 

– Implement real-time notifications and alerts

– Encourage safety practices among the customers

In case you build a mobile banking app only for smartphone use, you should consider all the regulations. If the app complies with them, it means that a lot of possible vulnerabilities are already covered. Also, don’t forget about GDPR, Open Banking initiative, and other country-specific requirements and regulatory institutions. For example, the UK has FCA (financial conduct authority).  

Examples of Mobile-Only Banking Apps

If you are to create a digital-only banking app, you better acquaint yourself with some bright examples of successful neobanks. What makes the best mobile app, and why are these digital solutions so popular?


Monzo is a UK-based digital-only banking app that wins customers over with its intuitive interface, variety of features, and appealing visuals. Monzo provides the following functionality: splitting checks with friends, sending money, keeping track of debts, sorting out salaries, fee-free cash withdrawals, and much more. With its direct competitor — Revolut — Monzo reigns supreme in the banking digitalscape of the UK.


N26 is a German neobank that functions in most countries of the EU zone, the US, and Switzerland. It also plans to expand to Brazil. The mobile bank’s key customers are freelancers and self-employed. N26 is a distilled version of the digital-only bank that offers all neobank essentials but doesn’t go over the top with automatic roundups for savings, IFTTT integration, etc.

ESL Mobile Banking (not a neobank really)

ESL Mobile Banking belongs to ESL Federal Credit Union, which is headquartered in the US. ESL is a very strict and formal mobile banking experience from a strict and formal US banking ecosystem. It provides “Access and use of mobile banking to check accounts, transfer money, or manage your personal information.” 

Basically, Mobile Banking is simply a mobile addition to the ESL infrastructure and not a neobank, so it shouldn’t be on this list. However, the ESL mobile is a bright example of the traditional banking giant that tries to go digital. ESL Mobile Banking is worth your attention.
If you want to read more about interesting fintech projects, you can go here.


Digital banks are the new black in fintech. It’s not strange, though, considering the huge spectrum of benefits and the convenience they grant. The market is still full of untapped opportunities for rookie digital-bank contenders to try their hand in. However, building an online banking app for only mobile devices is quite a hustle that requires an experienced tech team.  

If you want a mobile-only bank similar to the one mentioned above, we can actually help you develop such an app. With plenty of experience developing fintech and mobile applications, Kindgeek can ensure that your app will be a fancy and bulletproof piece of tech. And a pleasant bonus: we have battle-hardened business analysis expertise, which means we can polish the concept to boost a product’s performance in the market. Contact Kindgeek if you are interested.

What are the best examples of creating an online banking app?

Monzo, N26, and ESL Mobile Banking are the most prominent and secure examples of excellent banking applications that have been widely adopted.

How do I create a mobile-only banking app?

First, conduct thorough market research to learn your competition and target audience. Then choose the tech stack and decide on UI/UX design. Afterwards, you can start coding using your in-house staff or a software development provider. Finally, after rigorous testing, release your app to the public and collect feedback. 

What are the pros and cons of developing an online banking app?

The main reasons why people use banking apps are easy and seamless account setup, improved user experience, and lower fees. The downsides are the lack of human interaction, no ATMs, and security concerns.

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