Top 3 software challenges for banking

Adam Sandman, Founder, Inflectra

The banking industry is one that presents a unique challenge when developing and testing software. In recent years, cloud technologies and software as a service (SaaS) have become key components of the industry’s digital adoption and are essential for banking brands to remain competitive. And in a multinational industry like banking, software needs to be incredibly secure and reliable, while being fast, integrated and open to enable real-time global communication.

In this article, we’ll dive into the top software development hurdles the banking industry faces and how industry professionals can overcome these challenges.

1. Data Security

The financial industry is a particularly popular target for cybersecurity threats and protecting your customers’ sensitive data should be a top priority. However, banking brands should be less concerned with more “traditional” hacking methods such as stealing account passwords and breaking into phone systems, and more focused on software supply chain security. herself.

When there is a data breach in a banking app or website, the costs can be astronomical. Data hackers these days are finding ways to break into banking software through the “back door” by figuring out how to embed their malware directly into the source code itself. The software base behind many common mobile banking apps, for example, is often predefined and reused as a baseline by multiple institutions, making it that much easier to fall into the wrong hands.

To keep your data safe, pay close attention to where your source code comes from and who tests it. Additionally, when testing their software, financial institutions often make the mistake of using real data, which is a serious security risk. Rather than putting your customers’ valuable information at risk, use high-quality test data to mitigate the risk of a security issue.

Additionally, many software products use reusable open source building blocks called “libraries” or “modules” to perform common tasks such as error handling, logging, data access, and presenting data to users. . If hackers can inject malicious code into any of these core open source libraries, all commercial software that uses these libraries will be infected and affected.

One solution is to ensure that you have code-level traceability in your development process. Any change to your source code or any update to a common library must be associated with the appropriate requirement and/or change request. Also, consider including automated vulnerability scanning tools in your code integration pipelines so that any compromised libraries can be detected before the code update goes into production.

2. Confidentiality and residency of data

Banking is “global but local” – you need to be globally connected in order to move money around the world, while keeping data centers closed and secure. In recent years, many countries have required customer information to reside in that country for legal and regulatory reasons. This is especially a problem for multinational banking brands that share data centers to perform credit checks or other day-to-day consumer activities. Not to mention that keeping up with ever-changing regulations and data infrastructures from country to country can be a slippery slope for giant financial institutions.

Using a test management tool can help bank executives understand each country’s legal requirements when building and updating applications. As the application develops, banks can establish a comprehensive list of requirements that includes not only product features, but also legal statuses and regulatory rules. Once these requirements are codified, you can then develop a comprehensive test plan to ensure test coverage and assess traceability. This helps IT managers ensure that the finished software product complies with appropriate laws and statutes and meets functional needs.

3. Cloud technologies

The banking sector is one of many to have undergone a significant digital transformation in the heat of the pandemic. This includes banks favoring more modern and streamlined solutions such as cloud computing infrastructure. A cloud-based server means that a third-party provider hosts a company’s information offsite. The cloud also enables banking brands to connect with the necessary customers, partners and businesses all over the world. However, this virtual technology carries certain risks.

For businesses that house sensitive data like banks, there are security implications of cloud computing. From valuable customer financial data to employee login information, cloud breaches are a real cause for concern. This is why using a hybrid solution that includes both on-premises technologies and cloud infrastructure is often the best solution.

Cloud computing offers the benefits of leveraging robust computing platforms from large IT companies that have some of the most experienced resources in the world. However, many organizations using cloud platforms lack the skills or expertise to configure them properly, leaving customer data exposed in publicly accessible data buckets or incorrectly configuring firewalls. to block unauthorized access.

Conversely, traditional on-premises IT infrastructure is more costly and costly, but because it is less accessible to the Internet, routine misconfigurations have potentially less catastrophic results. By using an appropriate combination of cloud and on-premises IT infrastructure, businesses can get the best of both worlds.

As the financial industry has seen tremendous digital growth, banking software must constantly adhere to various financial industry regulations and laws to remain compliant. A test and requirements management tool provides the ability to stay on top of and track these changes in a single view. As banking technology continues to evolve and thrive, having the right software development tools in place is key to succeeding in a rapidly changing space.

Adam Sandman, who founded Inflectra in 2006, has been a programmer since he was 10 years old. Today, Adam is the CEO of the company. He is responsible for product strategy, technological innovation and business development.