Test Automation for Building Reliable Banking Systems

Banking systems are far more developed with the latest technologies. Especially during the last decade, technological advancements have changed how we transact and interact with banks and financial institutions. Technology improvisation is not expected to end; with every passing day and year, it is now an essential aspect of our financial dealings.

By integrating banking transactions through mobile phones using UPI and NEFT payments, banking has moved another step towards digital advancement. While many third-party apps can connect to a bank account and make payments, some banking apps allow users to check the status of their cheques and card applications.

Digital transformation in banking is a matter of patience and caution. A mistake made in an online eight-ball game will not cause much damage, but software cannot be trusted with people’s money. Anything that goes wrong with transactions will directly be the bank’s fault, which can be detrimental for businesses.

Every software bundle that a financial institution releases must undergo a thorough testing process to ensure nothing goes wrong. In a growing business, software testing cannot wait for long days of testing or be prone to human errors. Therefore, banks and financial institutions are adopting codeless test automation. Test automation saves time, money, and effort, while codeless reduces human errors in the applications.

What is test automation and how can it help the banking sector?

Whenever organizations develop software, they do not directly release the initial version to the market. At least, strictly, not in the case of banking systems. The one place where you don’t want loopholes is in the software that connects to banking and financial archives.

The way financial institutions offer services has changed. With digitalization, financial services are more advanced. From how you avail services and access data to record transactions, everything must proceed with uniform speed while maintaining the quality of financial software and expenses. A financial sector is a place with humongous amounts of public data under a confidentiality contract, which means that if a bug in service causes loss of money, the bank can be defamed and sued.

Organizations must ensure that the applications offer outstanding customer experiences with real-time data. Real-time data must be safe and accessible to the customers to ensure complete customer satisfaction. This very reason creates a need for testing banking or financial software. Until codeless test automation came into the picture, the testing of such software was done by human eyes and brains, which were susceptible to many errors due to long test lines for running the whole testing program.

With maturity in machine learning, the linguistics of machines are now used to create a precise testing platform that allows faster, much more efficient testing of software and privatised control of the whole process.

How does Codeless test automation help financial institutions?

Codeless test automation is necessary for most core banking processes like loan origination. Loan origination and trading are some of the most affected areas of the industry. Such core banking operations require faster software development and a stable system to handle a plethora of tasks, all at once. In a world where a single rating on the Play Store matters, a few unsatisfied users might create a bad image with negative reviews. To understand why the financial service industry requires end-to-end codeless test automation, we need to know the requirements of financial software:

  • The application must be multi-utility and flexible to handle several multi-tier user requests at any given point in time.
  • The app must safely integrate with third-party apps on a large scale.
  • The app must deploy secure transactions with end-to-end data encryption.
  • The servers of the application must be secured enough to keep personal information hidden.
  • The application must be synced in real-time with the archives to make quick transactions.
  • The software must be stable enough to perform several transactions within a short time duration.
  • The app must record every detail from all transactions and store them securely on the user’s device or cloud.
  • The software must be able to troubleshoot queries raised by the customers.
  • The app must have a fail-safe system to protect the users from emergencies like device theft or data attacks.

Here are some of the core banking segments that require codeless test automation:

●       Trading

The world of Wall Street and many forexes rely on secure, real-time data and money transfers because people’s hard-earned money is at stake. In such a complex game of numbers and sales, a minor glitch in the system or algorithm would cause chaos for thousands. Codeless test automation makes sure that the software is tested in the most complex of conditions to make it fail-safe.

●       Digital banking

Banks have come a long way from transfer and withdrawal slips. Payments are being made on phones using QR codes, and business is being conducted on current digital accounts—that too with a bank with no branches. When an entire bank promises core banking from anywhere and everywhere, the whole banking framework depends on the software. With codeless tests, banking automation can turn branches and passbooks obsolete.

●       Loan origination

The entire process of loan origination, from the applicant to the lender to the credit score calculators and back to the applicant, is a long, complex operation. The credit market is the most fluctuating market and needs secure and accurate data for confirmation. Loan origination can benefit from proper assessment and credibility of the applicant, enhancing the user experience on both sides. With codeless test automation, the application becomes error-free and helps make accurate lending decisions for financial institutions.

Choosing the right framework

As a financial institution, the software you introduce cannot be open ware. A banking institution is mandated to hide its clients’ crucial and private data. With codeless test automation, the control of the software while it is connected to a network shall be in safe hands. You can choose what functions need to be automated and which ones are to be kept on hold. For testing such software, the testing framework needs to be hybrid or library-based, so it can be customised frequently with changing data-sharing norms.

Conclusion

Codeless test automation can help transform the banking sector by creating reliable banking systems that have become the need of the hour. Most of the banking processes can be streamlined to provide improved services and better customer satisfaction, leading to the overall growth of the sector.

At Yethi, we focus on improving the efficiency of the organization’s core software system. Being a niche QA service provider, we have helped and are helping several global banking/financial organizations increase the agility, consistency, and accuracy of their platform. With our efficient test automation solution.

Tenjin is an easy-to-integrate, codeless automation platform. This revolutionary solution has taken the test automation to next level with an accuracy rate of nearly 100%. It is designed to rapidly scan through the software and detect errors. This innovative platform works 3x times faster than any other automated testing system, while the simple plug-in and play design enable easy integration. Tenjin is developed with a focus on continuously helping banks and financial institutions across the globe to build a robust and resilient testing process.

Test and Test Automation for PSD2 / Open Banking

The flexibility in digital banking as a form of open banking has compelled UK-based banks to share important financial information in a secured and organised way. The open banking concept is designed to transform the way people handle transactions. It is three years since banks in the UK have adapted to digital transformation and Open Banking, but there’s speculation about how secure the transactions would be.

These speculations about the adoption of PSD2 and Open Banking solutions can be put to rest. If organisations must run an Open Banking Solution successfully, they must ensure the following,

  1. API must be tested to ensure that it can handle the failed instances by responding with proper status codes.
  2. Integrated touchpoints are tested to ensure uncovering of the bottlenecks, irrespective of the application and technology complexities.
  3. The input data like customer or account information, deposit data, loan information, transaction details, and real-time process details are accessed through an interface that must be thoroughly validated.
  4. The expected performance load of applications must be validated, which concerns the factors like response time, scalability, downtime, and infrastructure costs. It ensures that the system’s stability and performance provide expected results even during high traffic with optimal resource utilisation.
  5. The banking APIs must be validated so that the application performs with desired results. Authentication is important for ensuring the performance of APIs.
  6. Validation of internal standards for creating audit trails and reporting procedures are must to ensure that the TPP partners have permission to maintain compliance for the API integrations of the financial institutions.

Beyond these speculations and apprehensions, there are opportunities to explore.

What is Open Banking?

Through open banking, the consumers, financial institutions, and third-party service providers can access and control customer information, financial records and transaction data from the banks and non-banking financial institutions using application programming interfaces (APIs). The concept of open banking is redefining the BFSI industry and customer experience.

Even though consumers are a little apprehensive about sharing a massive amount of data in an open platform through APIs, due to a couple of things going wrong, the fact that open banking has the potential to enhance the consumer experience is definite. However, customers must allow banks to access and control their personal and financial data by signing the terms and conditions of sharing the details with the third-party service providers.

Features of Open Banking:

  • Cash transactions are easy and convenient for the customers
  • Transferring cash to several accounts, or credit cards is faster using open banking
  • Checking the account balance of multiple banks on one platform
  • Calculates saving and expenses automatically based on user’s transactional behaviour
  • Combining all information of bank accounts and credit cards into a unified statement
  • Better money management using an AI personal financial assistant
  • Suggestions on saving for bills and insurance
  • Access to bank information for calculation of accurate credit score
  • Approval on loans and investment on a uniform platform

What is PSD2 and why is it now an integral part of open banking?

PSD2 Open Banking regulation implemented by the European Union. It is a regulatory directive initiated by the European Banking Association (EBA) and applies to European Union markets. The purpose of PSD2 is to make the payments and transactions easy, and banks must grant the rights to their customers to choose their payment partners to simplify the payment and transaction processes.

As PSD2 and open banking regulations have evolved to complement each other, and accordingly, open banking must also be compliant with all PSD2 directives. Open banking has now improved its scope by covering all payment products of PSD2 like Credit Cards, Debit Cards, e-Wallets, and more. Payments are likely to be fast and convenient through open banking solutions.

PSD2 and open banking serve as a uniform platform, eliminating various intermediaries such as merchant payment, payment gateway, Visa / MasterCard, issuing bank, acquiring bank, and others.

Features of PSD2:

  • Opens access to payment information for third-party payment service providers
  • PSD2 simplifies liability issues between the user bank and the third-party service
  • The PSD2 improves consumer protection
  • It eliminates the need for additional charges on payment methods
  • PSD2 ensures strict protection of consumers’ financial data by meeting security requirements for electronic payments

How do testing and QA work for open banking / PSD2?

To access open banking, banks must create open APIs, which must comply with regulatory standards, security protocols, safe data transfer, compliance with all the directives, and more. With these and many more prospects, Open banking needs regulatory testing, penetration testing, integration testing, performance testing, and security testing to ensure end-to-end platform security.

As customers access and transfer sensitive information and data simultaneously via open banking, the platform requires API, accessibility, and more testing to ensure that the platform is up and running without any technical glitches.

As open banking continues to grow and all financial institutions operating in Europe and UK must conform to Open Banking standards, it would require the testing team to ensure that the APIs and the platforms perform without disruption. They would seek expert QA professionals with extensive knowledge of open banking landscapes. The number of financial institutions is growing globally, which eventually may have to comply with Open Banking/PSD2. There is a greater possibility and opportunity to expand QA solutions far and wide.

Yethi’s role as QA testing partner for Open Banking / PSD2

Yethi is a reliable manual, and automation testing partner focused on the banking, financial and insurance sectors. We offer functional, non-functional and test advisory services including acceptance, regression, integration, performance, vulnerability assessment and penetration testing, and data migration. We have a well-managed Test Centre of Excellence by expert consultants who also offer tailored business process engineering.

An automated API provides intelligent, reliant, and seamless API testing to reduce testing costs and test-cycle time. Yethi no-code software automation testing solution, Tenjin is PSD2 and Open Banking ready. Its Oauth2 can work with the security and authentication standards currently in place. With its ease of use, Tenjin can test across your internal or on the sandbox environment. With multiple upstream and downstream integration points, Tenjin is ready for REST API.

Tenjin is built to be programming free and allows the functional testing teams and the system developers to test applications, making Functional, UI / UX testing, API testing and UI based business process testing easy and hassle-free. Our 5th generation codeless automation testing tools automate testing at the API level, enabling granular and faster test cycles in a multi-system environment; thereby facilitating early test adoption in today’s agile world.

Tenjin is an advanced automation suite, which can streamline API-level testing needs by rapidly switching between API and the GUI. We provide comprehensive regression testing in integrated environments to ensure a balance solution of agility and practicality.

Challenges associated with transformation projects from Legacy System to Digital Platforms

One of the major challenges that lie ahead of digital transformation is the legacy systems that the businesses run on.  Legacy systems are the software programs that have remained in use with the organization since its establishment or for several years.

With the modern technological advancements, the legacy system fails to keep up with the pace and often becomes outdated and unfit for business uses. It can hinder the efficiency of the operation process if data sets and other information can be leveraged to the extent of modern systems.

Hence, it becomes necessary either to upgrade or replace the legacy system to keep up with the current trend. Failing to do so, the organizations may not survive in the highly competitive market and may lose their business value. Hence, regular update/ upgrade or replacing the legacy system is required to align with modern-day digitization and improve the ROI metric of the organization.

Though the upgrade of legacy systems is inevitable, it is often a daunting experience to update them. Organizations should address the associated challenges with the legacy systems and resolve them for a smooth transformation to digital platforms. Once they are upgraded, they will ensure to offer an efficient operational and infrastructural process being leveraged by modern technology.

Legacy Systems: Everything you should know

Do you remember your first smartphone? How would you rate it in comparison to the one you have today? Undoubtedly, the one that you own today is way more advanced in terms of features and functionalities compared to the one that you had a decade ago.

Likewise, companies install a certain system at the time of their establishment which, over time, gets outdated and underperform. It is important to upgrade the system periodically to yield the best business outcome, but there can be a few challenges to upgrading the legacy systems. One such challenge is that it can be cumbersome, unruly, and challenging to update. End users might also be complacent with their existing systems and may be reluctant to transform their legacy platform.

The Characteristics of Legacy Systems explained

  • The system still fulfils the purpose it was initially meant for
  • They are not well integrated with other modern business solutions in use
  • The old technology of these systems does not allow it to interact with newer, modern systems
  • They do not permit the growth of the business tools and solutions specific to a company
  • Their support and maintenance services are longer available from the service provider
  • They are incompatible with modern and advanced solutions
  • It requires frequent patch upgradation
  • It requires multiple interfaces or multiple standalone systems / in-house systems to run the business smoothly and efficiently
  • It requires heavy customizations
  • It runs on obsolete technology  

Due to these limitations of legacy systems, organizations are adopting modern technologies that can provide solutions with greater efficiency, scalability, and adaptability.

Risks & Issues with the Existing Legacy System

  • Maintenance

Legacy systems typically have a huge codebase and are monolithic in nature. A little modification or replacement of one system module or even a small update can create conflicts across the system. It requires more time and effort to implement any new changes.

Every system in an organization requires regular maintenance to calibrate the system, clean up the junk data of the existing database, and ensure its efficiency is not compromised. Outdated software is hard to maintain in recent times as it is difficult to find the people with the required expertise and skillset. The maintenance cost of legacy systems can also be expensive.

Further, these systems have been loaded with large amounts of corporate data for years, the struggle of migrating this data-intensive system to a new platform can be full of hassles. An inefficient maintenance process may give rise to unexpected defects, which further leads to operating issues. Workforces familiar with handling modern IT solutions might face issues in managing old systems that reduce the operational speed.

  • Talent pool

Developers who are just starting are learning programming languages like JavaScript and C#. As legacy technology moves further past the point of manufacturer support, there are fewer and fewer IT professionals with the knowledge of those technologies. Thus, the costs of the smaller pool of experts in that technology grow. 

  • Cyber Security:

Cyberattacks are rising, which increases the cost of running legacy systems. Systems with obsolete infrastructure are highly vulnerable to cyberattacks due to inadequate protection and cyber protocols. The bottlenecks in these legacy system solutions pave the way to cyber-attacks and malicious tasks.

Organizations cannot afford to remain non-compliant with the latest security standards. It does not safeguard their systems from potential threats. A single unpatched vulnerability can enable attackers to access all applications, middleware, and databases running on the server platform.

Thus, associations still holding on to legacy systems are prone to risks of unauthorized access and neglect of their safety. This burdens developers with the priority to protect their systems and prevent hackers from fetching essential information.

The number of attacks that lead to privacy breaches is escalating every year. It can cost millions of dollars penalty to an organization. Hence, the Cloud storage system is becoming a booming substitution for legacy systems with enhanced security features.

  • Integration:

The most significant disadvantage of any legacy system is its inefficiency in integrating modern advanced software. A typical result of this lack of integration is the emergence of data silos, whereby different departments across a company cannot freely access the data they need.

Many modern clouds and other SaaS solutions can be incompatible with older legacy systems. It requires incorporating new tools and programs, extensive custom code to make it functional. The incompatibility of these applications gives rise to tedious steps that need to be followed in data migration.

Companies looking for development in their work processes face tremendous hassle in opting for suitable techniques that will build a bridge between legacy systems and present-day IT solutions. One of the most preferred technologies of this era is the Cloud storage service that covers up most of the loopholes present in the old systems.

  • Organizational agility and efficiency

Timing is extremely crucial to seize business opportunities. How fast can you respond to the market challenges? Will it take weeks to adopt new technologies and solutions? Or rather several months? The truth is, in most cases, businesses bound to legacy systems lack organizational agility to adapt to the upcoming challenges.

One of the most damning implications of continuing to use a legacy system is the stifled ability to modernize and improve. The most significant goal in digital transformation strategy is improving efficiencies and capabilities to remain competitive. Legacy systems in business are extremely inflexible, which becomes an obstacle for most organizations operating in today’s digital environment.

Customers expect organizations to be digitized, and executives see the digital transformation to be competitive. By not investing in new technology and sticking with a legacy system, you’re hampering your ability to compete and giving ground to your competitors. Maintaining data on Cloud is cost-effective compared to maintaining on Premises. It is more convenient to get access to the data when it is on the cloud than fetching it from on Premises.

  • Performance & Productivity:  

Legacy systems become slower and slower over time, which means performance, efficiency and productivity can also decrease. The older your application gets, the slower it becomes. Legacy systems usually consume more resources causing more frequent failures, which leads to inefficiency and unproductivity. As performance speed depends on the optimal usage of technology capabilities

The technology sector is fast-paced, and evolutions in software are emerging every day. A poorly performing software has no chance to stand out in the market, eventually incurring a huge loss to the company. Legacy Systems lack performance, efficiency, and productivity as they are incompetent with the modern approach. Therefore, upgraded systems can undoubtedly provide better data accuracy and speedy processing.

7 reasons why digital transformation of Legacy Systems is necessary for Business

Some of the advantages of transforming your systems digitally are as follows,

  1. Competitive advantage: Modernizing a legacy system, whether it’s an ERP, CRM, or your data center, can bring a plethora of advantages to your business. This allows you to become more capable, agile, and give you an upper hand over your competitors.
  2. Maintenance and Operation Cost: With the support of In-house staff like engineers and developers, organizations will be able to maintain and reduce operational costs. Organizations can also use third-party tools to fill the missing features of the systems. It would be easy to streamline the task whether automated or manually for the employees.
  3. More content employees: User interfaces have evolved significantly over time, and most employees will be accustomed to the modern UIs that improve customer satisfaction and performance over an older-style system that’s not as user-friendly. 
  4. Growth opportunities: Modernizing your legacy system gives you much more room for growth in the future.  Keeping pace with the latest tech and software developments gives you a competitive edge. It also puts you in a great position to further expand the services you use.
  5. Make use of big data: A major issue posed by legacy systems that digital transformation attempts to remediate is the silos that emerge from disparate systems within an organization. Transforming the legacy systems digitally remove these barriers and allow users to make use of the vast amounts of data big data that the Bank possesses to help support business decisions.
  6. Security and Performance: Digital transformation is highly secured compared to the legacy system. From the performance point of view, digitalization will be able to meet the expectation of the NextGen group and tap the market with new additional business from the Next G population as well as cope with the fast-moving pace of the global market.

How can a thorough test automation solution help in moving from legacy systems to digital platforms

When an organization is planning to upgrade its legacy system or move to new digital platforms, it is essential to conduct thorough test automation to ensure the new system is working seamlessly.

Successful automation strategies leverage the convergence of digital technologies with evolving systems to enhance the benefits gained by any organization. Digital technologies involving codeless test automation, automated regression testing, artificial intelligence, machine learning, and natural language processing have boosted productivity and accelerated the end-to-end process transformation. As a result, the steps to centralize, standardize, optimize, and automate software processes have become a lot more straightforward.

To ensure that the data is efficiently moved from the legacy system to the modern platform, it should be made sure that it is moved with minimal disruption and minimum data loss, in the most secure and scalable manner. Further, it should be made sure all the functional and non-functional objectives are achieved. Testing helps to achieve all the above said with increased speed, accuracy, consistency, and ROI.

How can Yethi help you?

Yethi is a niche QA service provider to banks and financial institutions worldwide. We assist professionals from the BFSI industry looking for end-to-end software testing solutions like Manual Testing, Automation Testing, Performance Testing, Security Testing, and more to improve Banking / Financial software quality.

We understand the importance of testing while moving from legacy systems to modern platforms, hence, we carry out thorough test automation to ensure the high quality of the system. We have the right resources and tools to carry out testing in the most efficient manner and yield the expected outcome. Our test automation platform, Tenjin, will perform all kinds of testing activity with utmost accuracy, precision, and consistency with nearly 100% results. It is a 5th generation codeless test automation tool; Tenjin is built with intuitive features that work flawlessly across multiple applications and is a fast and scalable test automation platform.