Innovative Banking Applications You Need to Know About – CXO Matters
Finance & Accounting

Innovative Banking Applications You Need to Know About

5 Innovative Banking Applications You Need to Know About
5 Innovative Banking Applications You Need to Know About
Image Courtesy: Pixabay
Written by Melwin Joy

It can be said that the opening of ATMs marked a turning point in the way people interact with financial institutions – especially banking. Since then, financial institutions started the journey towards technological interventions over the years. It soon became clear that the reason technology was trying to disrupt the industry was that for more than a century, banking could hardly be called “efficient and convenient” but rather “bureaucratic and burdensome.”

Technology has enabled financial companies to see customers from a different perspective. Now, using different technologies we can reinterpret how people consume financial services. Not everybody is a customer. But it is certain that they will all be affected by the new banking standards. The past couple of years has brought forth a multitude of innovations and inventions. Do you know what these are? Let’s explore some of these innovative banking applications and how they work.

Open banking

Open banking utilizes APIs that allow third parties to access customers’ banking data to build new data-based applications and services. Open banking, the next-generation banking application, does not only mean the opening of banks but rather a change in operation and business model. In addition to improved customer service open banking promotes rapid prototyping and new revenue streams – by providing fintech APIs with access to certain types of data for third parties. The key roles of APIs in banking include:

  • Improved customer service
  • Rapid prototyping of new service
  • New revenue streams
  • Gain data insights
  • Innovative designs
  • Better compliance
  • Data control and monitoring
  • Data security
  • Cost reduction

Mobile banking

Fully digital banks without physical branches are called neobanks or mobile banks. The advantage of registering a digital account is that you never have to go to the bank to receive the service. You perform all financial operations through the API. Banks, on the other hand, reduce the cost of maintaining physical branches and service personnel, so the focus is on providing cost-effective and user-friendly applications and services.

If you look at personal banking services, you will see that what banks offer is not what customers do on a regular basis. Neobanks understand the current needs of customers and change their operations accordingly. So, what do they offer to the new generation of customers?

  • Convenience
  • Spending analytics
  • Lower fees
  • 24×7 access
  • Account transaction reviews
  • Quick investments
  • ATM allocations

Microservice architecture

Modern banking applications depend on efficient technical architecture, which is expensive and lengthy. Here is where microservice architecture comes in.

Simply put, a microservice architecture is a system made up of small independent services, each focused on a specific function and easy to change, remove or update without significant negative impact on the overall system. This system has its own disadvantages. Since each service is an independent entity, they are all more difficult to maintain, manage and update. This would require more people contributing to the project, each assigned to a single microservice. You can also take an old-school system and add one or more microservices.