Personal data, especially related to finances, is a highly sensitive topic in terms of security issues. The financial sector ranks second only to healthcare in the number of data breach cases in the US, from 2020 to 2023. Statistics from 2023 indicate that data violation cases in the industry increased drastically compared to the previous four years, showing a 94% difference in incident numbers between 2022 and 2023. Conversely, between 2021 and 2022, there was a 4% dropdown. The cost of data breaches in the finance sector reached $5,9M worldwide in 2023.

The sphere of FinTech that requires attention is mobile banking security, as people perform more and more financial operations on their smartphones each year. This article will explore how custom mobile app development can help secure user data. But first, let's discuss the types of threats banking apps face in 2024.

Types of threats to overcome in the mobile banking app sector

Statista identified the most popular types of financial cybercrime in the US. Their data revealed five cyber threats that most Americans encountered in September 2023: credit card fraud, data breach, account hacking, online banking fraud, and phishing. Let's how these threats could potentially impact the mobile banking app sector and financial services.

Credit card fraud

Even though it is very convenient for the mobile banking app users to store and access their credit card details via applications, it makes them vulnerable to hackers seeking to steal their sensitive information. Such hacks can be possible if the app has insecure storage or doesn't use secure communication channels. However, it's rare that reputable bank apps lack proper encryption or authentication measures.

Data breach

Data leaks can occur due to inadequate authentication methods, poor coding practices, and weak data encryption. Hackers may exploit vulnerabilities in applications or servers that store user data. Strong encryption is crucial for securing backend systems and preventing data loss. It transforms data into a secret code, accessible only with a specific key.

Account hacking

This involves unauthorized access to user accounts, which should be challenging with robust banking app security measures in place. The best way to preserve an application from account hacking is to implement a multi-factor authorisation method. When accessing an app, a user not only needs to type in a password with login but also a one-time password (OTP) delivered via SMS or push notification.

Online banking fraud

Cybercriminals create fake mobile banking apps that mimic legitimate applications but are designed for fraudulent activities. The worst outcome of these malicious intentions is theft. The best preventative measure for businesses is to distribute apps only on official stores, and for users to download apps only from trusted platforms. Users should also review app ratings and number of downloads before installing.

Phishing

While not directly related to application development issues, hackers can use phishing attacks to steal users' account details and perform further hacking activities. The technology that protects users' accounts in such a case is two-factor authentication which allows entering the app only with an extra layer of security beyond a simple password.

Mobile banking app security measures to avoid cyber attacks

First let's discuss mobile banking security measures that are fundamental and highly important for the fintech industry, such as complex user authentication which, for example, game apps do not require. Then, we'll delve into a broader discussion on general measures that need to be taken to develop a secure application.

Biometric authentication

Biometric authentication is a type of cybersecurity where a user accesses an application using unique biological features such as voice, fingerprints, or facial recognition.

All client data or templates recognized are stored in a database, which should be rigorously protected. Among the benefits of biometric authentication is that biological traits such as fingerprints cannot be duplicated and don't change over time. Additionally, this type of scanning is extremely convenient and easy to use, enhancing the user experience.

Multi-factor authentication

Unlike single-factor authentication, multi-factor authentication requires more than just a username and password for successful authentication. Users must pass through two or more security layers, making it much harder for hackers to break in. Typically, this involves a password combined with a mobile app verification code provided by an app like Google Authenticator, an SMS code, or a phone call. While it's less convenient than typing in a password alone or scanning a fingerprint, this method provides significantly higher application security.

Encryption

A security method that cannot be overestimated. It preserves data by converting it into an unreadable format (ciphertext) that can only be decoded using a decryption key. This allows only authorized access and ensures data integrity. In simpler terms, if someone tries to copy and spread encrypted data, it will be unintelligible to third parties without the decryption key.

Fraud detection

Fraud detection systems provide uninterrupted monitoring to prevent fraudulent activities. They use data analysis and machine learning algorithms to detect anomalies within a mobile banking app. Implementing such a complex system requires data collection, reprocessing, model training, real-time monitoring, investigation, and other actions. However, the effort is worthwhile, as fraud detection significantly enhances an app's security.

Automatic logout

Automatic logout is a mobile banking security feature that logs out a user after a period of inactivity in the app. In compliance with the Payment Services Directive II, users performing online payments can only remain logged in for 5 minutes without any activity. After this time, the app should automatically log out the user.

Regular updates and patching

Just like technologies constantly evolve, so do hackers' techniques. Software updates and patches are crucial to keep pace with these changes. A patch is a bug fix or modification to software that aims to improve an application. Software providers regularly release updates that enhance security, and it's essential to implement these changes promptly.

Building a secure bank application

For more accurate information, in this section, we'll look at the measures our company takes to protect mobile banking apps. Actually, we believe in prioritizing the security of all our users, regardless of the specific app.

Some FinTech app security measures, such as strong encryption, multi-factor authentication, and fraud detection, have been mentioned previously. However, there's much more to consider, especially when understanding the inner workings of the application development team. Let's delve further into the secure app creation process.

Standards-compliant servers

Proper servers provide the basic protection of app user data. Popular choices for storing user information include Amazon AWS and Google Cloud servers. Our company uses these services due to their compliance with industry standards.

Both Amazon AWS and Google Cloud servers adhere to the Payment Card Industry Data Security Standards (PCI DSS). This standard for account data protection was established by such well-known credit card associations as Discover, JCB, MasterCard, Financial services, Visa, and American Express and is currently administered by PCI Security Standards Council.

The PCI DSS is a set of standards that formulate the minimum rules for protecting customers' payment card information and sensitive data, which is crucial when building a mobile banking app. It regulates the storage, processing, and transmission of cardholder data.

Secure CI/CD pipelines

CI/CD stands for Continuous Integration and Continuous Delivery. These are tools and activities that automate software development processes. CI is the process of integrating changes in the code delivered by multiple contributors. CI includes an automated process of bringing all pieces of code in a single software project. CD ensures that all changes that have been made are ready for release to production. With its help, code can be automatically deployed to a production-like environment.

Since CI/CD deals with testing the code and making sure that when changes are deployed everything is secure and correct, the tools used for mobile banking app development should comply with PCI DSS.

We use CI/CD tools that have demonstrated PCI DSS compatibility, including GitLab for CI and Argo for CD. Thus, every new piece of code in GitLab undergoes automated security testing for vulnerabilities and license compliance. Argo CD also implements measures to ensure only authorized access to sensitive information and prevents data leaks. By automatically checking and deploying code, these tools facilitate quick updates to the mobile banking app code without compromising application security.

Reliable frameworks

The choice of the server-side framework for a banking application plays an important role in providing mobile banking app security. A reliable framework should inherently provide protection against cyber threats. We rely on Laravel in our backend development for banking apps. It is a PHP development framework that is secure from such vulnerabilities as a Distributed Denial-of-Service (DDoS) attack and SQL injection.

DDoS attack

A cybercrime when an attacker floods an app with internet traffic so that users wouldn't be able to access the service.

SQL injection

An insertion of an SQL code into an application in order to access and steal data.

By using Laravel for server-side development, we automatically avoid these kinds of threats.

Secure development

Should one choose to work with a software company to build an application, it is imperative that the vendor follows application security standards in the process of mobile app development.

Basic measures

The following are fundamental security measures that every software development company building a mobile banking app should follow.

Microservice architecture

Our company builds banking applications using a microservice architecture. This approach helps to provide restricted levels of access to different parties. For example, a service that deals with transactions is not connected to personal user data. Additionally, each service stores its data separately. This diversification of data enhances the app's security by limiting the impact of a potential hack. Even if an intruder gains access to a single database, they will only have access to a limited subset of data, preventing them from causing significant harm.

Data validation

A vendor must validate input data to ensure queries are correct and unexpected fields are ignored. This helps prevent malicious input from compromising the app.

Access rules

The development team should establish clear access permissions. Developers must define what actions users can take and what data they can access through the financial app. This minimizes the potential for unauthorized data access.

Limiting response data

Engineers should design the app to provide only the minimum necessary information to users, keeping sensitive details hidden. This reduces the risk of data exposure.

Automated testing

Automated testing enhances the robustness of an application by ensuring the code is error-free. This directly influences the mobile banking app security. It helps to identify vulnerabilities, such as SQL injection mentioned earlier.

Extra measures

Our company cares much about security and standards compliance in all industries where we build mobile applications. We take meticulous measures to protect our products from cyberattacks.

GitLab environment variables

We store secret keys to services, databases, passwords and others in GitLab CI/CD variables. It is like a special container where you can store the most important information. Only people with a high level of permission or “maintainers” can access the environment variables and make changes.

Project VPN

We secure all the important tools and systems related to the project, including the admin panel, Argo CD, Laravel Telescope, and API documentation, using a Virtual Private Network (VPN). A VPN provides us with a secure connection, meaning that only authorized persons can access project tools.

Third-party authorization

For third-party authorization, our development team uses the Auth0 tool. Auth0 is a platform for authentication and authorization specializing in verifying user identities. This tool handles identity management and complies with all necessary industry standards, including PCI DSS.

Design

Even interface design can help in securing user information in a mobile banking app. For example, account details should be secured not only from cyber threats but from a casual glance. Therefore when opening account details the user should take another action, like press the button, to view full details. Otherwise, an interface should only display the last four digits of a card number or account number. It also should include notifications for unusual activity, clear password guidelines, and visual feedback. The latter means that sensitive information should be highlighted or hidden, therefore, warning mobile banking app users that they should carefully handle certain information.

Payment card industry data security standards

We've briefly mentioned the PCI DSS documentation, but haven't yet mentioned its specific requirements. Since mobile banking applications handle transactions and payment frequently, it is crucial to make these actions as secure as possible. Therefore, the PCI DSS documentation outlines specific goals and requirements that the PCI DSS documentation recommends online financial services providers should keep in mind. Mobile devices, compared to laptops, are more vulnerable due to cellular technologies such as GPS, Bluetooth, and NFC as well as cameras, microphones, SIM, and SD cards.

The main document focuses on the entire system of secure payments, including payment acceptance. Of the 12 requirements, three are particularly relevant for all fintech app development companies:

Protect stored account data

The objective is to avoid storing sensitive data after authorization. The document emphasizes the need to secure primary account numbers, if stored, as well as cryptographic keys used for data encryption. Account data encompasses both user information and sensitive authentication data (SAD).

Protect data with cryptography during transmission over open, public networks

This requirement mandates that software development companies implement mechanisms to protect user data with cryptography during transmission over public networks. This is crucial because unencrypted data can be easily accessed by hackers over untrusted networks.

Develop and maintain secure systems and software

These requirements align with the mobile banking security measures discussed in the article, including timely patch updates, secure coding practices, secure custom software development, and all necessary processes to build a secure application.

Let's build a secure mobile banking application together

By incorporating robust security mechanisms into the development process and staying abreast of the latest banking app security solutions, you can build a fintech app that can withstand any cyberattacks, thereby establishing trust between the business and its clients.

At Ronas IT, we believe that security should be at the forefront of mobile banking app development. Should you like to build your next app with our team, we'll be happy to work on your project. Just click the ‘Get in Touch’ button below, and we'll get back to you shortly.