Mobile apps have made our lives much more convenient. We’re able to connect with long-lost friends, have groceries delivered, and make travel plans, all from the palm of your hand. With most of these apps, privacy and security aren’t of utmost importance. But with financial or banking apps, it’s all about security. According to this report, consumers in the US lost over $30 billion in 2015 due to security breaches, and this study claims mobile fraud cases rose over 44% from 2017 to 2018. Meaning, the better the security measures have evolved, the more these cybercriminals are improving their methods.
Fraud and theft are at an all-time high, and if you’re developing a FinTech app, you need the best security controls available if you want to attract and keep your users. We’ll go over several methods of security and theft to better prepare you as you enter this crucial phase.
What Is FinTech?
Let’s start with defining a FinTech app, as there are a few different kinds to consider. Financial technology applies to a wide array of financial services as used via computer, software, and mobile apps. Services include mobile banking, wealth management, lending and mortgages, stock market trading and advice, and person-to-person money transfers.
The term itself can also refer to things like payment portal technology, cryptocurrency, and fundraising, but we’re looking primarily at mobile apps from the perspective of a FinTech startup. There are technologies and methodologies to learn from all of these different iterations – even from the big banking institutions – and we’ll touch on several of those here.
To provide an example, check out the work we did for Payix, a leading FinTech company that provides collections tools, payment processing resources and business intelligence solutions.
Find Your Niche
The type of mobile app you are developing will guide the various security features you need to be aware of. It’s worth noting that some FinTech apps don’t involve direct contact with money, like the popular FinTech/social networking app StockTwits. They combined live market updates with important tweets regarding the market, and enables you to join a financial advice community. StockTwits is extremely successful, and should take the normal privacy measures that any social networking platform would employ. Other apps that offer advice, or connect you with people who can give you that counsel, also don’t need strict security measures. But if you intend to store or transmit any financial data or funds, you need to start your development phase with the best security available.
Protect At All Costs
Security for mobile apps is constantly evolving, so we’ll go over the best measures out there now.
- Multi-tiered Authentication: An everyday password isn’t enough to protect your funds. Instantly generated second passwords can be sent to your email, and other biometric identifiers like fingerprints or facial recognition gives your defenses another wall if your device is stolen or compromised. Some fingerprinting authentication features can also transmit location, IP address, and other identifiers.
- Encryption: There are many spots in a transmission where you can encrypt the financial data moving through. Powerful encryption software not only hides this data in multiple locations, but will also conduct continuous audits to identify any potential weak spots.
- Real Time Notifications: Most big banking apps have you set up automatic text and/or email locations whenever certain transactions take place. If remote hackers have found and stolen your passwords or other parts of your identity and are trying to pull money out of your account, these notifications give you valuable time to notify your bank to ensure this fraud is taking place.
- Secure Back End Support: Building out your FinTech app with top technical support and powerful secure servers is always the best path. While the Cloud makes data storage and distribution easier and faster, it can also be more vulnerable to hackers. Make sure it’s scalable, so various updates and fixes are seamless and secure while the popularity of your app is growing.
- Digital Signatures: For major transactions, digital signatures are one of the best fraud protection methods around. End-to-end encryption and third-party authenticators ensure that the data is transmitted safely, and also limit the ability of either party to dispute the terms of the deal and back out. Digital signatures can take time and money, but is ideal for larger than normal transactions.
Keep Your User Informed
Lots of security measures depend on what your end user knows about how to protect themselves. They should know how important the authentication steps are, especially if you start to get feedback on how long it takes to access their accounts. Making those steps easy and simple may be quicker, but can severely compromise their security, so reminding users how crucial it is to not remove any security measures themselves.
They should also be very clear about what to do if their device is stolen or goes missing; having a smooth communication path to report a missing phone and freezing the associated account immediately goes a long way to shut down imminent fraud. Having a responsive support team and easy ways to contact them should be a priority.
Hire the Right Team
You may be a coding or programming whiz, and if you’re developing an addictive game or simple on-demand delivery app, you can likely do a lot on your own. When it comes to constructing an ironclad security system for your FinTech app, however, you need to work with the professionals. An experienced app development partner will have business analysts, security experts, and a team that knows the full scale of what it takes to develop, launch, and support an app like this. This is an investment, but one that will pay massive dividends in the future. Remember, you’ve got a great idea! Making the wrong choices in the early stages is something you can’t take back, so listen to the experts and get that app going!
Want to check out some of our work to see if Koombea is the right app development partner for you? Check out our cases studies.