Software vendors are crucial. They provide digital solutions to help banks operate efficiently and meet customer expectations. However, while ready-to-use solutions offer speed and convenience, they often fall short in delivering a tailor-made user experience that aligns with a bank's unique brand, strategy and customer needs. How can banks choose the best software provider in terms of UX, and what future risks might arise from using third-party software?

The Role of Software Vendors in Digital Banking

Banking software providers develop and sell solutions such as online and mobile banking platforms, CRM systems, fraud detection systems, loan origination, and accounting systems. These providers help banks operate efficiently and meet customer expectations by offering tailored software solutions. Their key responsibilities include:

• Developing and maintaining banking software
• Understanding banks’ specific needs
• Providing ongoing support and maintenance
• Staying updated with banking industry trends
• Offering training and support materials

Partnering with software vendors provides banks with the speed and flexibility needed in the Fintech era, leveraging the vendors' expertise to swiftly implement digital solutions and save resources.

Main UX Risks of Banking Software Provided by Vendors

Evaluating the UX of digital solutions from banking software vendors is critical. While financial institutions aim for rapid digitalization, UX ultimately determines whether users stay or switch to a competitor with a more user-friendly product.

Key UX risks to consider:

1. Lack of User-Centricity. Technical teams often lead software development, sidelining UX designers. This focus can result in a lack of empathy, making it hard to design user-centered solutions. Effective vendors integrate UX experts who understand user psychology, marketing, financial services, and multi-platform design.
2. Over-Featuring. Banks often choose software based on features, but users prioritize usability. If a service is too complex, users will switch to simpler alternatives. Top vendors prioritize user needs and feedback, focusing on delivering a comprehensive user experience, not just software.
3. Outdated Experience. Long development times can result in outdated solutions upon release. A modular approach can help but may not meet the complex needs of large banks, leading to integration issues.
4. Platform Limitations. Universal solutions aim to save resources but often fail to meet specific bank and user needs. The best vendors offer UX customization and use advanced Design Systems to tailor solutions.
5. Over-Complexity. Universal solutions must cover various scenarios, leading to complex user flows. Adding new elements post-sale can worsen UX due to complex architecture and poor navigation. Banking software must have intuitive and scalable information architecture.

Choosing vendors who prioritize user-centered design, flexibility, and seamless UX is essential for a successful digital banking experience.

Main UX Criteria and Steps for Choosing Provider

Banking software vendors are continually improving their products to be more user-centered. They hire UX experts and often collaborate with external UX agencies such as our, and UX consultants to achieve this goal. At the same time, banks are getting increasingly active in managing the above-mentioned risks on their own.

In particular, some banks separate the implementation of the core platform and the development of the UI/UX frontend solution. This allows them to use a ready-to-use vendor solution while establishing the best UX in cooperation with the UX design agency such as ours.

Banks should pay attention to five key UX design aspects when choosing the ideal banking software platform:

1. Align with the Bank's UX Strategy. Ensure the solution aligns with your bank’s UX strategy to maximize customer value. Define your digital strategy: which banking services are essential, their form in digital channels, and the user emotions they should evoke based on your bank’s positioning and identity.
2. Evaluate Information Architecture Simplicity. Assess whether the platform's information architecture is intuitive for users. Beyond aesthetic interface design, consider the administrative environment and EX (employee experience). Overly complex interfaces increase training costs and error risks, frustrating users. Group sections and content blocks clearly and use simple, jargon-free navigation labels.
3. Facilitate Key User Scenarios Easily. Identify and prioritize user scenarios based on current behavior to evaluate the vendor’s product usability. The execution of these scenarios should be straightforward for any user. Develop a Failure Map for deeper analysis of negative experiences, as these are most memorable. A good solution should consider all potential negative scenarios.
4. Compare Performance with Alternatives. In a competitive market, ensure your solution meets or exceeds competitors in technology, convenience, clarity, and simplicity. The chosen platform should appear future-ready, modern and offer an advanced user experience.
5. Enable UX Adjustments Post-Launch. Excellent UX is an ongoing process. Ensure the vendor can make post-launch changes upon request based on user feedback. The bank should also have access to the software for continuous UX improvements.

Steps to Choose a Software Vendor

1. Identify Needs and Priorities. Clearly define your bank's specific needs and priorities, especially regarding UX strategy and product requirements, before searching for a vendor.
2. Research Potential Vendors. Research potential vendors through online reviews, peer recommendations, and industry events to understand the latest developments in banking software.
3. Evaluate Vendor Capabilities. Assess the capabilities of shortlisted vendors, considering their software features, industry track record, and support and maintenance abilities.
4. Compare Pricing and Contracts. Compare pricing and contract terms, considering upfront costs, ongoing fees, and contract length and terms to ensure the best deal.
5. Make a Decision. Weigh the pros and cons of each vendor based on your evaluations and make an informed decision. Request additional information or clarification if needed.

By following these criteria and steps, banks can select the apropriate banking software provider to enhance their UX and overall customer satisfaction.

Conclusion:

The partnership between banks and software vendors is more than a business arrangement; it is a collaborative effort to innovate and excel in digital banking. By focusing on user-centric design, continuous improvement, and seamless integration, software vendors help banks deliver superior customer experiences.

However, the conflict between the benefits of adopting ready-to-use solutions and the need for tailored, brand-specific digital service cannot be overlooked. While ready-to-use solutions provide quick deployment and cost efficiency, they may lack the depth of customization necessary to fully represent a bank’s brand and meet the nuanced demands of its customers.

Therefore, banks must carefully evaluate software vendors, prioritizing those who offer flexibility and customization alongside exceptional UX. As the digital banking landscape continues to evolve, the ability to balance the advantages of pre-built solutions with the necessity for bespoke, customer-centric approaches will be crucial for sustained innovation and growth.

Check out my blog about financial and banking UX design >>