Everything You Need to Know About Security Technologies in Banking Applications

Banking went mobile and revolutionized the financial industry with its unprecedented convenience to users, but this convenience is reached through significant security challenges. 

To make a mobile banking app that is secure means to protect user data and your own company’s information, and that way, maintain trust.

We’re going to look into the technologies and protocols used in mobile banking app development that protect mobile banking applications from hackers, data leaks, and other threats out there. That’s not the one and only goal for today for us though. You’ll also understand the differences between securing a mobile app and a banking website, this includes discussing mandatory and optional security protocols in particular.

Factors That Make Banking App Development So Complex

Banking app development is a complex process and not only security requirements make the development so complicated. 

The development process is also influenced by regulatory compliance that ensures adherence to all relevant regulations and standards. Balancing security with a seamless user experience is quite challenging too.  

What Technologies Make Mobile Banking Apps Secure?

A fundamental security technology that protects any mobile banking app on the market is encryption. Encryption transforms data into an unreadable format so that only those with the decryption key can access it.

There are several encryption technologies that are commonly used not just in the banking industry, but in others too. End-to-end encryption is arguably the most widespread, so let’s focus on it. 

E2EE (End-to-End-Encryption) encrypts that so much precious data on the user’s device and ensures that it’s decrypted on the server only. This prevents interception during transmission. 

An Advanced Encryption Standard, or AES, is a popular example of an E2EE. It uses 256-bit keys and is considered an effective way to protect your app’s data.

Multi-factor authentication as an extra layer of security

With MFA, multiple forms of verification are required before access is granted. MFA usually combines

• Something that the user knows (a password, for example)
• Something the user has (a smartphone)
• Something the user is (biometric data, like fingerprints or facial recognition)

Implementation is usually done by integrating services like Google Authenticator or hardware tokens.

You can “simply” go with Biometric Authentication

Biometric Authentication uses unique biological traits to verify a user’s identity. Apart from mentioned before fingerprints and facial recognition, voice recognition has also become available. 

To have Biometric Authentication, your app must be integrated with device-specific biometric services. Apple’s Touch ID or Face ID and Android’s biometric APIs are exactly this kind of security method, all of them guarantee secure authentication processes.

Tokenization to keep your credit card information safe

This method means that all sensitive data is replaced with unique identification symbols called tokens. Tokenization is particularly useful in protecting credit card information during transactions. All the actual card details are never stored or transmitted, so the risk of data breaches with tokenization is minimal.

Give the app a playground

The next method is called Application Sandboxing. With it, an application is running in a restricted environment that limits access to the rest of the device. 

Isolation of the app keeps any potential malicious behavior inside of this environment. That way, this malicious code cannot affect other apps or data on the device. Both iOS and Android have built-in sandboxing features.

Various Secure Coding Practices to double-check everything

There are a lot of code analysis tools you can use to detect vulnerabilities. Static Application Security Testing (SAST) is one of many examples. 

And apart from that, adherence to fundamental coding standards together with regular security audits are super helpful in identifying potential security flaws early in the development cycle.

A common strategy to optimize the development process is to team up with custom financial software development services. That way, you reduce the risk of security breaches and legal consequences and receive a guarantee that your app will be efficient.

Is There a Difference Between Mobile App and Website Security?

Yes, and that difference is huge. That is due to the unique characteristics and vulnerabilities of each platform.

Mobile apps’ security depends on the security of the device itself. You cannot have a protected app without a protected device. This means that the integration with the mobile OS’s security is a must, be it device encryption or a basic secure boot feature.

Then there are App Store Policies. Each and every mobile app undergoes scrutiny by either Google Play or Apple App Store or both, depending on what OS your app is available on.

What are the specifics of Website Security?

Banking websites, on the other hand, rely on browser security. The two essential technologies here are HTTPS and once again – encryption (this time, browser-based).

The second important factor in website security is the security of the network. You ought to implement both Transport Layer Security (TLS) and Web Application Firewalls (WAF) protocols to protect the data in transit. 

You must do everything necessary or you’ll suffer from threats like SQL injection or cross-site scripting (XSS).

What Security Protocols Are Mandatory and What Are Not?

Knowing with what security protocols you’ll surely be dealing is important. So, here are the security protocols regulations obligate you to integrate:

• PCI DSS for secure handling of credit card information
• GDPR to protect user data privacy (only if you operate in the EU)
• CCPA to ensure consumer data privacy rights in California
• SOX to keep proper financial transparency and combat corporate fraud

The list of optional security protocols is much smaller and consists of only 2 positions:

• ISO/IEC 27001 provides a framework for an information security management system, or ISMS
• NIST Cybersecurity Framework that offers guidelines and best practices to manage various cybersecurity risks

Final Thought

A deep understanding of security technologies and protocols helps in making your mobile banking app secure. 

But don’t stand still. The financial industry doesn’t stop evolving. Stay ahead of security threats through advanced technologies and best development practices to safeguard data and maintain user trust.

Stay ahead of security threats through advanced technologies and expert development practices will be crucial for maintaining user trust and safeguarding data.