How Do Banking Apps Make Money?

By 2025, it is expected that mobile banking users will grow to 217 million in the USA.

As a majority of people are going towards a cashless future, it is nearly impossible to ignore this trend.

With such high competition, any investor will be curious to know about app monetization strategies that keep them ahead and drive users to pay.

If you are also in the same dilemma, then find out about how to monetize your banking app efficiently with some proven methods that make you money.

What is Monetization in Banking Apps?

Mobile Banking App Monetization is a process of including different money-making models to earn money from your banking app.

A well-researched monetization strategy can help retain and grow a user base. In addition, a strong monetization model can provide a reliable cash flow, which can be used to improve the app’s offerings and content.

It can also make users feel comfortable & in control, and increase their engagement with the app.

If you look around, then you will find a lot of successful apps like Chime, Revolut, and more, they all have amazing features and know how to cash it out in front of users.

Somewhere you can understand how important it is to have a top monetization model so read till the end to find out the right monetization strategy for your banking app.

Banking Apps Market Overview

Let’s take a look at banking app statistics depicting the future of banking & financial services.

Get to know them in numbers:

• As per reports, the digital banking platform market is likely to reach $220.1 billion during the forecast period 2021 to 2030.
• It’s expected that the market is expected to grow at a CAGR of 29.7%.
• In the second quarter of 2024, 62% of bank account holders in the US used their smartphone or tablet to process banking matters.
• In 2023, over 66% of the US population used online banking. Statista estimates that the penetration rate will increase to over 79% in 2029.
• Among other regions, North America will lead the market during this period.

Now, as we are done with the stats, we will take a look at why monetizing your banking app will be a smart idea.

Why to Monetize Banking Apps?

A smart investor always invests in business from where they can get a good return.

And, the same goes for banking apps.

In case, you want more reasons for the development of a banking app & monetize it, then we will look at some top reasons & answer some related questions:

♦ Better ROI

To turn your banking app into reality, you are going to make a great investment.

With that, somewhere investor expects to get better returns, and this is where making banking app monetization is beneficial.

An app draws a larger user base, makes it easy to target a huge audience, and increases their involvement; your banking app turns into an asset.

♦ A Growing “Trend”

There are around 3.3 million apps available on the Google Play Store & 2 million on Apple App Store. Now, with that, it is clear that apps are becoming an important part of day-to-day lives.

Presently, the focus has shifted to hygiene, safety, and convenience; it is driving the demand for more banking apps. So, if you decide to monetize a banking app, then this is the right time.

With amazing features and high-quality design, you can cater to the changing needs of your users & earn good money.

♦ Rising Smartphone Penetration

The increased usage of mobile phones & internet connectivity is the reason people are looking for more digital banking solutions.

As more and more people get access to smartphones, the need for convenient banking services through digital channels rises.

In this competition, you can present yourself as a friendly help. Once they are your loyal customer base, they can even pay to enjoy more features from your app.

♦ Enhanced Customer Experience

The traditional ways through which people used to access banking have completely changed, now people are shifting to mobile apps.

These apps are rich with features and offer convenience to users and that’s what users want. Moreover, these apps enable 24/7 access to their services.

So, when people look at these benefits, they are fascinated to know about these apps. With that, you get an advantage to leverage their interests and turn it into profit.

See, these are some of the great reasons to monetize your banking app.

Let’s get to know it in the next section:

List of Best Monetization Strategies for Banking Apps

As we discussed how your banking app can be a source of revenue.

Let’s take a look at the best monetization strategy for banking apps that can add colors to your app:

• Subscription Fees

The Subscription Model is a growing trend in banking apps.

Through this model, banking apps can charge users a monthly or annual fee for access to premium services.

These services can include innovative features including advanced budgeting tools, financial planning, credit score tracking, or higher withdrawal limits.

You can offer exclusive perks including access to personalized financial advice or rushed customer support.

With a subscription model, banks can attract users to upgrade, ensuring repetitive revenue while retaining customers.

The key is to ensure that premium services provide enough value to justify the cost, encouraging user conversion and retention.

• Transaction Fees

One of the best ways to monetize banking apps is through transaction fees including charging customers for certain financial activities, such as money transfers, bill payments, or ATM withdrawals.

These fees can be flat-rate or percentage-based, depending on the transaction type.

Moreover, users can pay fees for making transfers or accessing premium transaction features such as higher withdrawal limits.

Transaction fees are a common and consistent revenue stream for banking apps, especially when processing huge volumes of payments, making it a trustworthy source of income for financial institutions.

• Loan and Credit Interest

In banking apps, loan, and credit interest is one of the most common yet tested mobile banking app monetization strategies.

Banks can leverage their mobile apps to provide personal loans, mortgages, or credit cards. Revenue is generated through interest on these products, with the bank charging a fixed or variable rate on borrowed amounts.

By analyzing customer financial data, banks can offer personalized loan options, making the app a convenient platform for users to apply for loans or credit.

This strategy is beneficial for both the customer, who gets quick access to funds, and the bank, which earns from interest payments over time.

• Advertisement

Advertisement is one of the tried and tested monetization methods for banking apps.

Banks can generate revenue by incorporating ads into their mobile banking apps. These ads can be targeted based on user data, such as spending behavior or financial interests, making them highly relevant.

Advertisers from financial sectors, like insurance providers, investment firms & loan agencies, are prime candidates for ads in a banking app.

Banks can either partner with ad networks or manage direct relationships with advertisers, earning revenue based on impressions, clicks, or conversions.

However, the key challenge is balancing ad placement with user experience to avoid irritating users which could otherwise drive them away.

• Affiliate Marketing

Affiliate marketing is an effective banking app monetization, where the app promotes third-party financial products, such as insurance policies, investment plans, or credit cards.

When users click on affiliate links and sign up for these services, the bank earns a commission or a fixed fee.

This strategy capitalizes on the bank’s existing customer base, offering tailored products based on individual user data, such as income level, spending habits, and financial goals.

Since banking apps already have access to valuable user information, they can provide highly relevant affiliate offers, which can increase conversion rates and overall revenue.

• Cross-Selling Financial Products

Banking apps can monetize by cross-selling additional financial products to their existing customer base.

For example, a user with a checking account may be offered savings accounts, credit cards, loans, or insurance services.

By leveraging customer behavior, transaction history, and financial profiles, the app can suggest personalized product offerings.

This method increases the overall customer lifetime value, as users are more likely to engage with financial products that align with their needs.

Cross-selling also benefits the bank by increasing product uptake while offering users more comprehensive financial solutions, improving their loyalty to the app.

• Data Analytics and Insights

Banking apps can monetize anonymized user data by providing aggregated insights to third parties, such as market researchers, fintech companies, or advertisers.

With user consent and in compliance with privacy regulations, banks can offer valuable data regarding spending patterns, financial behaviors, and trends.

This data can be used for targeted marketing, product development, or market analysis.

However, transparency and privacy are essential in this model to maintain user trust.

By anonymizing sensitive data and ensuring strict compliance with regulations, banks can tap into a profitable revenue stream while enhancing customer relationships with personalized offers.

• Premium Support Services

Offering premium customer support can be a lucrative monetization method for banking apps.

This can include dedicated account managers, faster response times, or access to financial advisors for personalized consultations.

Premium support can be included in subscription plans or offered as an add-on service, allowing users to pay extra for priority services.

This strategy is particularly appealing to high-net-worth individuals or users who need specialized assistance with complex financial products.

By providing exclusive, high-touch service, banks can increase customer satisfaction and generate a recurring revenue stream from users willing to pay for enhanced support.

• Foreign Exchange Fees

Foreign exchange (FX) fees represent a significant Banking app revenue model, especially when users engage in international transfers, currency conversions, or travel-related services.

Banks can charge a markup on exchange rates or a fixed fee for FX transactions.

Many apps also provide users with multi-currency accounts, offering the convenience of holding multiple currencies.

Fees for international transfers and currency exchange can be tiered based on the transaction amount, making it a scalable revenue model.

Offering competitive rates and transparent fee structures can attract users, while also generating a steady income for the bank from frequent foreign transactions.

• In-App Investment Services

Monetizing through investment services is a powerful strategy for banking apps.

By offering users access to stock trading, mutual funds, or robo-advisory services, banks can generate revenue through transaction fees, management fees, or performance-based charges.

Investment tools within the app can help users manage their portfolios, track market trends, and make informed financial decisions.

For premium services, banks can charge management fees for personalized investment strategies or access to exclusive products.

With the growing interest in retail investing, this model not only diversifies the bank’s revenue streams but also provides users with valuable tools to grow their wealth. This is why it is one of the most talked about banking app monetization strategies.

Top Banking Apps and Their Successful Revenue Models

So, how do banking apps make money?

As the market is full of so many banking apps with successful revenue models, you might have given it thought to know about top banking apps and how they are earning money from the market.

1. Chime

Chime is a digital bank that offers users a simple, mobile-first banking experience. It offers features like a no-fee checking account, savings account, and access to a network of ATMs. Chime is designed to be a user-friendly, fee-free alternative to traditional banks, especially for those looking to avoid high banking costs.

Monetization Model: If you are wondering about how Chime makes money? It’s through transaction fees on debit card purchases and a small percentage of fees from its credit-builder services. It also generates income from partnerships with third-party companies offering financial products, such as credit cards or loans that provide commission or referral fees. It has an amazing revenue model that inspires others to develop an app like Chime.

2. Revolut

Have you heard of Revolut? Revolut is a global financial app that provides different services from currency exchange, stock & crypto investment, & travel insurance. It focuses on offering users the ability to manage all their financial needs in one app, with a strong emphasis on global usage and ease of cross-border transactions.

Monetization Model: Revolut utilizes a freemium model, where users can access basic features for free but must subscribe to a premium tier for advanced features like cryptocurrency trading, airport lounge access, and travel insurance. Revolut also generates revenue by charging transaction fees, foreign exchange & commission on financial products.

3. N26

A famous banking app is N26 a European digital bank that offers a wide array of banking services, including checking & savings accounts, personal loans, and investment options. It is known for its user-friendly mobile interface and focuses on offering a transparent, hidden-fee banking experience for tech-savvy users.

Monetization Model: N26 primarily follows a freemium model, offering a free account with basic banking features, and charging for premium accounts with added benefits like travel insurance, better withdrawal limits, and exclusive offers.

4. Monzo

One popular digital-only bank in the UK is Monzo which offers comprehensive banking services, including checking accounts, savings, and loans. Monzo’s platform is known for its budgeting tools & transparency, helping users track their spending & manage their finances more effectively. It also serves as an inspiration for people to make apps like Monzo.

Monetization Model: Monzo monetizes its app primarily through subscription fees from its premium plans, Monzo Plus & Monzo Premium. These accounts offer perks such as travel insurance, increased ATM withdrawal limits, and other exclusive benefits. The app also generates revenue from foreign exchange transactions and overdraft fees.

5. Wise

Formerly known as TransferWise, it is a global money transfer service that helps users send money across borders with lower fees and faster processing times compared to traditional banks. It offers multi-currency accounts, a debit card, and easy access to international transfers. To make an app like Wise, you should focus on user experience and engaging features.

Monetization Model: Wise generates revenue by charging transparent fees for international money transfers. The company makes money by taking a small percentage of each transfer, based on the amount and destination country. Wise also offers premium features, such as a multi-currency account, which provide added benefits at a cost, contributing to its revenue model.

6. Simple

Simple is a mobile-based banking app that aims to make banking more accessible & less complicated for its users. This app offers checking accounts, savings goals, and a budgeting tool, all of which are managed through its easy-to-use app interface.

Monetization Model: Simple generates revenue through fees on certain banking services such as Overdrafts and ATM withdrawals beyond the free limit. Moreover, it partners with merchants to offer cashback deals and special offers, earning a commission from these transactions. The app focuses on a user-friendly experience, minimizing hidden fees, and simplifying financial services.

7. Acorns

Acorns is a top financial app that focuses on micro-investing, allowing users to invest spare change automatically rounding up purchases to the nearest dollar and investing the difference. The factors that made it famous are financial advice and investment options to allow users to grow their savings.

Monetization Model: Acorns uses a subscription-based model where users pay a monthly fee for access to investment tools, financial advice, and automated savings. The company also generates revenue from the investment returns it helps generate for users, typically taking a small percentage as a management fee. Acorns may also earn commissions on financial products offered through the platform.

Now, the question is “How to choose the right monetization model for your banking app?” if you are wondering the same.

How to Choose the Right Monetization Model for Your Banking App?

Sometimes the cost of developing a banking app can be overbearing.

Time to know how to get the investment back and make some revenue as well.

So, let’s talk about how to choose the right monetization mode for your banking business:

► Get to Know the Target Audience

Choosing the right banking app monetization strategy starts with understanding your audience’s financial behavior and preferences.

Are they price-sensitive or willing to pay for premium features? For example, young users might prefer a freemium model, while high-net-worth individuals may be more likely to opt for premium services.

Conducting market research, including user surveys & analyzing competitor models, will provide insights into which banking app monetization strategy aligns best with user needs and their financial habits.

► Analyze Your App’s Core Features

The features and functionalities of your app should play a crucial role in choosing the right banking app monetization model.

If your banking app offers unique services like investment tools, credit-building features, or proper financial planning, it may benefit from a subscription or freemium model.

On the other hand, basic banking services with limited features might be better suited for transaction fees or ad-based monetization.

One of the huge challenges in the development of mobile banking apps is to tailor the monetization to core offerings to ensure long-term user engagement and profitability.

► Consider Long-Term Business Goal

Aligning the monetization methods for banking apps is crucial to achieving your business goal. Are you focused on rapid user acquisition or on maximizing revenue from fewer, high-value users? For apps aiming for growth and broad user engagement, a freemium or ad-supported model may be best.

If the goal is sustainable revenue from a smaller but more loyal customer base, subscription or commission-based models could be more effective.

Choose a model that helps meet your growth or profitability targets.

► Evaluate Competitors Strategies

A key to successful monetization strategies for banking apps is evaluating what works for competitors in your market.

Analyze how similar apps generate revenue.

If competitors are thriving with a subscription model, it may make sense for you to implement a similar approach. However, if others are struggling with user retention due to fees, you might want to explore a low-cost or ad-supported option.

Evaluating the strengths and weaknesses of your competitors’ models allows you to avoid common pitfalls and adopt better strategies.

► Regulatory & Compliance Factor

You might miss it, but while selecting a monetization model for a banking app, consider the cost of regulatory and compliance associated with the chosen model.

Such as monetizing through fees or financial products may require more rigorous regulatory oversight. This could result in additional costs for legal compliance, data protection, and consumer transparency.

A simpler ad-based model might have lower compliance costs. Weighing these factors will help ensure that your monetization approach is both effective and legally compliant, reducing the risk of costly regulatory penalties.

► Analyze User Experience And Retention

User experience is a critical part of the banking app’s revenue model.

A good model should not negatively affect the user experience or drive users away. Such as an overly aggressive mobile monetization strategy, such as frequent ads or high fees, can frustrate users and increase churn.

Ensure that the monetization model for banking adds value to the customer experience. Features like premium customer support or personalized financial tools can justify subscription fees, improving retention while boosting revenue.

► Test and Iterate Monetization Models

Choosing the right Banking App Monetization model may require experimentation and iteration. Start by implementing different models on a small scale to see which one resonates best with users.

For example, try offering a free version with optional paid upgrades or monetizing through small transaction fees. Monitor user feedback and behavior to refine your strategy.

Over time, as user behavior evolves, continuously reassess and adapt your monetization model to ensure long-term profitability and alignment with market needs.

How Nimble AppGenie Can Help in Banking App Monetization?

Want to develop a banking app that sparks user interest? Let us help!

Nimble AppGenie, a top banking app development company can help you build a top-notch app with amazing features so that you can enjoy multiple revenue models and a loyal customer base.

We have experienced developers, designers, and experts to offer you an app that not only stands out in this competition but increases ROI.

What are you waiting for? Let’s connect to transform your idea into an asset!

Conclusion

To increase your profits, it’s best to monetize your banking app.

While the growing market depicts it as the best idea; it also requires proper planning and execution. By understanding how banking apps make money and integrating these models, you can enjoy huge revenue.

Remember, with a commitment to excellence & maintaining a balance, you can develop a banking app that leads to success in the dynamic market.

FAQs

Niketan Sharma

Niketan Sharma is the CTO of Nimble AppGenie, a prominent website and mobile app development company in the USA that is delivering excellence with a commitment to boosting business growth & maximizing customer satisfaction. He is a highly motivated individual who helps SMEs and startups grow in this dynamic market with the latest technology and innovation.