Low-code and no-code in banking practice

Mariann Harrison

Low-code and no-code in banking practice

Author: Máté Hidvégi, Head of Development at ApPello

These days, software writing and application development are undergoing major transformations. Over the past few years, low-code and no-code solutions have gained ever more ground in the IT world of financial institutions. The change is primarily due to the fact that these platforms allow enterprises – even if they have only limited software development capacity – to create precisely those applications they need instead of using off-the-shelf software that can be purchased on the market.

Software at a couple of clicks?
Every sector goes to great lengths to attract developers to support their digitalization endeavours. Transformation is not primarily driven by a self-serving desire for digitalization, but far more by simple market competition in which, of course, no one wants to risk falling behind. However, the surge in demand for specialists in this field inevitable resulted in scarcity, thus currently one often finds a shortfall in programmers creating bottlenecks in the digital transformation process. Recognition of this state of affairs resulted in companies starting to engage professionals from outside traditional software development circles, a shift that is made possible primarily by low-code and no-code technology. These platforms rely on visual modelling when it comes to creating applications instead of the use of traditional programming languages.

By employing low-code/no-code technology, a given task can be formulated and executed at a higher level of abstraction compared to classical coding, many intermediate steps can be omitted from development processes, monotonous, repetitive tasks are eliminated thus leaving more time for productive work. There is no need to self-write the code of the planned application, there is no requirement to do all the self-testing, but on the other hand it is critical to understand exactly how the platform works. In other words, we have not yet reached the point where anyone can write functional software with just a couple of clicks without having any kind of background in programming, program design, mathematics or logic. The application of such systems continues to demand a high degree of expertise, just of a different nature to that of coding. It is necessary to acquire a formal modelling language instead of, or in addition to, the standard, formal programming language.

By utilizing these tools, development can progress far faster and the worktime of developers can be better exploited in the modelling of business processes. Thanks to the easy-to-use processes, a company’s day-to-day work can be boosted and competitiveness enhanced, the knock-on impact of which is strategic progress, too.

What does the future hold?
Experts in the field reckon that within just a few years, enterprises will be creating the bulk of their apps on low-code platforms. Earlier research conducted by analyst firm Gartner predicted that by 2020, 70% of large companies would have guidelines on in-house no-code developments, and by 2024, 65% of app developments would be on no-code platforms. According to the study, by this date three-quarters of companies would already have at least four types of low-code platform. Whereas no-code platforms can greatly facilitate and accelerate developments on the part of banking users, the design of such systems also presents a number of new challenges for their developers.

So what do banks get out of it?
Financial organizations are also increasingly relying on their own software solutions. This is no mere coincidence: over the recent past, the costs, production time, complexity and risk constraints of fashioning customized business software packages have all dropped dramatically. The appearance of low-code and no-code platforms means that now companies are able to develop precisely the application they require without any unnecessary frills or functions. The platforms have proved to be particular effective in creating apps for customer management, data handling, as well as payment and subscription services, thus it comes as no surprise to hear that their use is becoming ever more widespread within the financial sector.

In the last few years, these sorts of development platforms have started to be used to solve some of the problems of the financial and fintech market. The no-code platform allows analogue spreadsheets to be transformed into easily accessible data streams while documentation and quality assurance processes are optimized. For example, a bank can use the platform to generate a real-time database, thus it can automate the credit appraisal process. Without this, it might be necessary to ‘manually process’ up to 20 documents, but with the help of the real-time database the 30-hour process can be slashed to just 30 minutes while data filtering and sorting are made far more efficient.

This, however, is just the tip of the iceberg. Financial institutions have to be in compliance with a mass of regulations, tasks are monitored and approved by different departments, frequently employing methods that – working from spreadsheets – are extremely tedious and have the potential for many errors. The platform can also provide the ideal solution for the establishment of a company-wide quality assurance and monitoring hub.

Some organizations set up complete innovation centres using this method. For example, a Dutch insurance company reduced the need for individual authorizations for customer relations management systems and payment handling systems, and it also established a department that rapidly develops, tests and implements new services for its customers.

Solutions from ApPello
Naturally, these developments raise a thousand questions. For example, where to draw the line between the demands of the customer and the product? When is it possible to say that a demand is customer-specific and not part of the standard package, and how can this be differentiated? What happens if a customer wants a unique field, a one-off calculation, a new integration? How can all these be supplied with a no-code platform? Is there any way specifically to change the basic components so that it is only accessible to that customer? How does such a flexible platform handle performance?

Applying different solutions, ApPello’s Digital Platform provides answers to the challenges and facilitates the lightning-fast, no-code delivery of business modules. One such step is that we have made the data model of the system dynamic in recent years: a data model that can be expanded without programming available for every ApPello system. Thanks to rapid screen construction, we can even create new screen displays in an extremely short time using our drag-and-drop interface. Complex business calculations can be made for the supplemented data model using our Decision Engine module. We develop an application programming interface (API) for every business procedure. In these, individual fields can also be handled not only with ApPello modules but also in coordination with the apps of other service providers, be they financial transaction, treasury or card management solutions. Processes are customizable at Business Process Model and Notation (BPMN) display level, which means that qualified users can modify them themselves in as little as a few hours without having to interfere in the system. These few steps help us deliver a no-code business module that is fully configurable.

However, in a large banking environment no-code platforms must meet additional criteria, for example, in the area of compliance with performance and IT regulations. In these cases, coding is essential and ApPello has developed its own hybrid delivery model for this. This model can separate the individual demands of the customer at source level as well, be they a need for IT infrastructure or the development of a business process, or perhaps the creation of a totally unique screen for a given customer.

Our delivery model is also built on configuration: individual, customer-specific codes can be set here at configuration level. Using the hybrid model, we deliver extremely quickly and can make very rapid changes to screens, algorithms and integration points.

One of the main reasons for the high satisfaction levels of our clients is precisely this agility, this ability to implement rapid changes that our own platform provides.

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