How Much Does it Cost to Develop a Mobile Banking App? The Full Guide

Building a mobile banking app is a popular trend currently, and one of the steps in creating one from scratch is determining the cost. This article will explore the factors that contribute to the cost of developing a mobile banking app and provide an estimate of the expenses involved in creating a fintech application. With the increasing number of people conducting financial transactions online, physical bank branches are becoming less relevant. This shift towards mobile banking is driving growth in the fintech industry, as there is now a high demand for multifunctional banking apps, making the market highly competitive.

What is a banking app?

A banking app is a mobile application that allows customers to access and manage their bank accounts, credit cards, and other financial services from their smartphones or tablets. These apps are designed to provide users with a convenient and secure way to check account balances, view transaction history, transfer money, pay bills, and more.

Banking apps also provide users with a range of security features to protect their personal and financial information. These include fingerprint or face recognition, two-factor authentication, and encryption to prevent unauthorized access to sensitive information.

In addition to traditional banking services, many banking apps also offer additional features such as investment and budgeting tools. This allows customers to manage their money more effectively and make informed financial decisions.

The value of the Global Mobile Banking Market was estimated to be $692.5 million in 2021 and is expected to increase to $1.36 billion by 2028, with a projected compound annual growth rate (CAGR) of 11.9% during the forecast period.

Source: Vantage Market Research

In this article, we’ll mention the 3 most popular banking apps in the USA. 

Citibank: Citibank is one of the largest banks in the United States and provides a comprehensive range of banking and financial services to its customers. Its mobile app offers features such as account management, bill payment, mobile check deposit, P2P money transfers, and the ability to view account balances and transaction history. The app also includes a range of financial tools and resources to help customers manage their money and make informed financial decisions.

• AppStore rating: 4.9

• Google Play rating: 4.8

Source: Citibank

Wells Fargo: Wells Fargo is one of the largest banks in the United States and offers a variety of banking products and services to its customers. The bank's mobile app provides users with access to account information, the ability to pay bills, deposit checks, transfer money, and view transaction history. The app also features financial management tools, alerts, and notifications to help customers stay on top of their finances.

• AppStore rating: 4.8

• Google Play rating: 4.8

Source: Wells Fargo

USAA: USAA is a financial services company that provides a range of banking and insurance products to its customers, primarily those in the military and their families. The bank's mobile app provides users with access to their accounts, the ability to deposit checks, transfer funds, pay bills, and view transaction history. The app also offers financial management tools, investment resources, and insurance information to help customers manage their money and protect their assets.

• AppStore rating: 4.8

• Google Play rating: 4.1

Source: USAA

What affects the cost?

The cost of developing a banking app is a crucial component of the overall budget for creating and launching the app. Typically, the cost of building a banking app is calculated by using the following formula: multiply the number of hours required for development by the hourly rate of the developer's work.

Type of app and its complexity

When it comes to determining the cost of mobile banking app development, one of the key factors to consider is the type and complexity of the app. The cost of developing a mobile banking app can vary greatly depending on the specific features and functionalities that are required.

For example, a simple mobile banking app that only allows customers to check their account balances and transaction history will likely be less expensive to develop than a more complex app that includes features such as mobile payments, money transfers, and budgeting tools. The more features and functionality that are required, the more time and resources will be needed to develop the app, and the higher the overall cost will be.

• Native app 

A native app, which is built specifically for a particular operating system such as iOS or Android, will typically be more expensive to develop than a cross-platform app, which can run on multiple platforms. This is because native apps require specific programming languages and development tools, while cross-platform apps can be built using a single codebase and then deployed to multiple platforms.

Pros of building a native app:

• Improved UX: Choosing iOS or Android provides a more seamless and intuitive experience for users, allowing for easier navigation and a more customized interface.

• Faster performance: Native apps are faster and more responsive than mobile websites, as they are built specifically for the device's operating system and hardware.

• Access to device features: Native apps have access to the device's features, such as camera and GPS, which can be leveraged for enhanced functionality and a better user experience.

Cons of building a native app:

• Higher development costs: Developing a native app can be more expensive than creating a mobile website, as it requires specific skills and resources for each operating system.

• Maintenance and upgrades: Native apps require regular maintenance and upgrades, which can be time-consuming and expensive, especially for complex apps.

• Reduced reach: Native apps are only accessible to users who have installed them on their devices, whereas mobile websites can be accessed by anyone with an Internet connection.

• Cross-platform app

Pros of building a cross-platform app:

• Reduced development costs: Building a cross-platform app allows for the creation of a single codebase that can run on multiple operating systems, reducing development costs and time-to-market.

• Wider reach: Cross-platform apps can be deployed on multiple operating systems, increasing their reach and accessibility to a wider audience.

• Easier maintenance: Cross-platform apps only require a single codebase, making maintenance and upgrades easier and more cost-effective.

Cons of building a cross-platform app:

• Performance issues: Cross-platform apps may not perform as well as native apps, as they are not optimized for specific operating systems and hardware.

• Limited access to platform-specific features: Cross-platform apps may not be able to access all the platform-specific features and APIs, which can result in a limited user experience.

• Complex development process: Building a cross-platform app can be a complex process, as it requires knowledge of multiple programming languages and platforms.

Location of the development company 

The location of the development company can be a significant factor in determining the cost of mobile banking app development. The cost of labor and other expenses can vary greatly depending on the region where the development company is located.

Let’s observe some of the most popular locations for hiring remote banking app development teams (with the approximate team composition). 

• USA

Pros

✅Access to skilled talent: The US has a large pool of highly skilled software developers and designers with experience in banking app development.

✅Time Zone Compatibility: The US is in a similar time zone to many countries, making communication and collaboration easier.

Cons

👎Cost: US-based teams can be more expensive compared to teams from other regions. This is perhaps the biggest issue with hiring remote teams from the USA. 

• Poland

Pros

✅Cost-effective: Compared to teams from other countries, remote teams from Poland can offer a cost-effective option for banking app development.

✅Good command of English: Poland’s EF EPI score is 600, which is considered as ‘very high.’ Many Polish software developers are fluent in English, making communication and collaboration smoother.

✅Access to high-quality tech talents: Poland has a large pool of highly skilled software developers and designers, many with experience in the financial industry.

✅Strong technical background: Polish software developers have a strong technical background, ensuring high-quality deliverables for your project.

Cons

👎Time zone difference: The time difference between Poland and some other countries may make scheduling challenging.

• India 

Pros

✅Cost of development: Teams from India can offer perhaps the most cost-effective development services compared to teams from other regions.

✅Large pool of talent: India has a large pool of software developers with diverse technical skills, making it easier to find the right team for your project.

✅Availability: With a significant time zone difference, teams in India may be available to work on your project outside of regular business hours.

Cons

👎Quality Concerns: While there are many talented software developers in India, the quality of work can vary, and some teams may not have the same level of expertise as those from other regions.

👎Cultural Differences: Teams from different countries may have different work styles, attitudes, and cultural backgrounds, which can lead to misunderstandings or challenges in collaboration.

👎Challenges with IP protection: Protecting intellectual property can be a concern when working with remote teams, especially in countries with less stringent IP laws.

Technology stack

Another significant aspect that can affect the expense of creating a mobile banking app is the technology stack used. The technology stack refers to the combination of programming languages, frameworks, and tools that are used to build the app.

When considering the cost of mobile banking app development, it's important to take into account the technology stack that will be used. By considering the complexity and expertise required for the chosen technology stack, it is possible to get a better understanding of the costs involved and make informed decisions about the development process. 

In this section, we’ll give you an example of an approximate tech stack for iOS, Android, and cross-platform banking app. 

Please note that the technologies mentioned are only a rough guide, the actual tech stack could vary depending on the specific requirements and constraints of the project.

The main features and how they determine the app cost

The cost of creating a banking app is closely associated with the features and their level of complexity. The more features that are included in the app, the higher the expenses will be. Furthermore, features that are more time-consuming or require unique technology will result in a higher cost.

In this article, we will provide examples of common features found in banking apps, and provide an estimate of the time needed for development (in sprints). To estimate the cost, you can multiply the total number of hours by the hourly rate of the developers you hire as discussed in the previous section.

Mobile banking apps offer a wide range of features to make banking more convenient and accessible for users. Some of the main features that can be found in mobile banking apps include:

1. Authorization

This feature allows users to log in to their account using a secure method such as a password, PIN, or biometric authentication (FaceID, TouchID for iOS).

2. Viewing card information

This feature allows users to view information about their debit or credit card such as the card number, expiration date, and transaction history.

3. Current balance and transaction history

This feature allows users to view their current account balance and transaction history in real-time, providing them with a clear overview of their financial situation.

4. Initiating secure person-to-person transfers

This feature allows users to easily transfer money to other people using the app, providing a fast and secure way to make payments.

5. Spending Analytics 

This feature provides users with insights into their spending habits and helps them make informed decisions about their finances. It presents spending data in an easy-to-understand format, allowing users to see where their money is going, track their expenses over time, and set budgets for future spending. 

6. Notifications 

The app sends real-time notifications for important events such as deposits, withdrawals, and low balances, allowing users to track their spending and make informed decisions. Notifications can also be customized, allowing users to select the types of alerts they receive and how they receive them.

7. In-app chat with customer support

With this feature, users can get the help they need in real-time, without having to leave the app or wait on hold. The in-app chat also provides a convenient and secure way for users to get assistance, helping to ensure that their financial information is protected. 

The cost estimation is based on the average hourly wage of frontend engineer ($50) and backend engineers ($70) in Poland.

Extra features of a banking app: Time & costs

QR-code scanning

QR code scanning is a technology that allows users to scan codes from their mobile devices and access information or perform actions. 

Cashback service

Cashback services are a type of reward system that provides customers with a portion of the money they spend back in the form of cash or credit.

Booking third-party services

Booking third-party services is a feature that allows users to book services from within the banking app, without having to leave the app to visit a separate website or use a separate app. This feature can greatly enhance the user experience by providing users with a more seamless and convenient way to access services such as travel bookings, food delivery, and other services.

Splitting bills

This feature allows users to divide the cost of a purchase among multiple people.

ATM and office locations

With this feature, users can easily find the nearest ATM or branch.

That said, the cost of developing main features (frontend + backend) for a mobile banking app starts at $250,000. 

Sum up 

We at Yellow have more than 7 years of developing FinTech solutions for businesses big and small. As a dedicated banking software development company, we have a thorough understanding of the current market landscape, the most effective technologies and frameworks available, and are able to leverage our expertise to develop an app tailored to your specific business requirements. If you have an idea for a future banking app, we'd love to hear from you. Please don't hesitate to reach out to us to discuss how we can help bring your vision to life.