How do mobile banking apps make money?

These days, payment applications play an important role in micro-banking payments, such as top-up purchases and bill payments. These applications sponsor many popular TV programs and appear on the TV screen 24/7 and encourage people to install these apps and make transactions by holding competitions and awarding various prizes. But the question is how these applications operate and where they earn money.

Earning from fees

PSP companies or payment apps make money through fees paid for each transaction. This is while the banking network criticizes the current fee system. Banks believe that the fee must be paid in the transaction through card reader devices because the fee is free for the person who swipes the card; this cost is left to the receiving bank. Therefore, the fees paid by the banks are ultimately paid to the PSP and application companies. In the current model, the purchase transaction fee is paid directly by the accepting bank, the bill and charge transaction fee is paid directly by the issuing bank, and the card owner pays the balance transaction fee. Some companies have agreed to pay a part of the received fee to the acceptors in order to achieve the transaction and consequently more profit and have created a phenomenon called fee seeking in the payment industry. Activists believe that if an electronic wallet is launched in the payment industry, 70% of current transactions will be done offline, significantly reducing the fees that go out of the banks' pockets yearly.

The world's most famous digital banks and their services

The Thefinancialbrand website prepared this list. Since there are many digital banks, the selection criteria for these banks have been proposed:

- Banks that only operate online and have a unique brand

- They are beyond traditional banking applications

- They do not act as a substitute for branch-based banks

Banks such as Atom Bank are not introduced in this list because only banks that have been officially introduced to the public are considered. Also, this list is limited to officially launched digital banks that conduct most of their marketing activities in English.

All over the world, there are various applications for online payments, and their number is constantly increasing. What is the most important criterion when choosing a bank payment application ? Payment security may be the most important issue for you; you want to be completely sure that your account information will not be stolen when using this application. On the other hand, for some consumers, the ease of using the application is more important, and, according to this group, all tasks should be done with a few simple clicks. The breadth of application services is also more important for others. But the fact is that popular applications are the ones that have all these features.

In this article, some commonly used applications are introduced. For their selection, the consumers' views and ratings in Apple and Google stores are considered. Of course, the choice has been made among the applications in a high position regarding security. Every year, various organizations survey online payment applications' popularity. All the applications introduced in this article are popular.

- Ally Bank

The first application is Ally Bank. This application, which provides services only online, has a lower cost than other traditional financial institutions, and the customer can use its services from 45,000 ATMs across the United States. Ally is one of the popular banks that provides various financial services and offers high-interest rates on deposits. All the services you expect from a banking application are provided in this application, and the important thing is its ease of use. Of course, from the point of view of Android users, this application is not very attractive.

Features: One of the best providers of digital financial services, with no monthly subscription fee, and 24/7 support, ally bank products are divided into various things such as banking, investment, mortgage, and credit card. One of the special features of ally digital bank is its integration with the Zelle payment system.

- Merrill Lynch Bank

The second is Merrill Lynch's banking application. This bank is vast, with 16,000 ATMs across the United States, and is highly trusted by customers. The fee of this bank is suitable for providing services, and the mentioned services are provided with advanced technology. If the bank sees a suspicious case, it sends an SMS to the account owner so that they can prevent the continuation of banking operations. All financial services needed by customers are provided in this bank's application.

- Capital One

The third one is CapitalOne. If CapitalOne is your wallet, you can access an application with full features. Surveys show that the level of satisfaction with this application is very high because not only is the security of its transactions at acceptable levels, but it is also unparalleled in terms of the range of features.

- Huntington Bank

The fourth item is the Huntington Bank application. You may not have heard the name of this application. Still, the level of customer satisfaction with it is the highest, that is, in all aspects, including overall satisfaction, availability of key information, range of services, and transparency of information. Consumers are very satisfied with it.

- Wells Fargo Bank App

The fifth is the Wells Fargo Bank app. Wells Fargo is another very large bank that has a wide network of ATMs, and the fees for the financial services it provides on its app are very low. The security features of this payment app are impressive, so it is good for the users.

- Parent company: Clydesdale Bank & Yorkshire Bank

- Website address: www.youandb.co.uk

- Date of establishment: 2016

- Number of employees: a/n

- Headquarters: England

Features: A digital and smart banking service provider, you can have a checking account and a savings account, as well as a credit card and a debit card, all of which can be managed through one app. B allows users to spend, save and borrow on a single platform.

- Bank mobile

- Parent company: Customers Bank

- Website address: www.bankmobile.com

- Established date: 2015

- Number of employees: 140

- Headquarters: United States of America

Features: One of the fastest-growing digital banks. Its mission is to provide affordable and powerful banking services to millions of Americans and empower them. BankMobile's features include photo-based bill payment, personal financial management tools, 0.75% annual interest on savings, and peer-to-peer (P2P) mobile payments.

- CBD Now

- Parent company: Commercial Bank of Dubai

- Website address: www.CBD now.ae

- Date of establishment: 2016

- Headquarters: United Arab Emirates

Features: Account opening within 5 minutes, with a credit card within 24 hours.

- Chime

- Website address: www.chimebank.com

- Date of establishment: 2013

- Number of employees: 46

- Headquarters: United States of America

Features: Visa Debit Card, automatic savings programs, no fees, instant alerts and daily balance updates, cash rewards on purchases, and 1.75% interest on savings.

- Digibank

- Parent company: DBS

- Website address: dbs.com/digibank

- Date of establishment: 2016

- Number of employees: n/a

- Headquarters: India

Features: e-wallet, mobile payment, mobile investments, AI-powered virtual assistant, savings, and earning.

- Fidor

- Website address: www.fidorbank.UK

- Established date: 2009

- Number of employees: 75

- Headquarters: Germany

Features: A checking account whose interest rate is influenced by the number of Facebook likes, with a smart platform for discussing financial matters.

- Finn

- Parent company: Chase

- Website address: chase.com/finnbank

- Date of establishment: 2017

- Headquarters: United States of America

Features: It is considered one of the digital banks in the United States of America. Users can open accounts, make deposits, issue checks, track expenses, and save using a mobile phone. Finn also has tools for evaluating transactions.

- First Direct

- Parent company: HSBC

- Website address: firstdirect.com

- Number of employees: 691

- Headquarters: England

Features: The first direct bank on earth, one of the few digital banks that offer services such as personal loans, investments, and insurance.

- GoBank

- Parent company: Green Dot

- Website address: www.gobank.com

- Date of establishment: 2013

- Number of employees: 892

- Headquarters: United States of America

Features: Including US Neobanks that provide services such as online checkbooks, person-to-person money transfers, personal financial management tools, wallets, and access to over 40,000 ATMs.