Transaction Banking Evolution and Testing

Transaction banking plays a significant role in the functioning of corporate and banking institutions to allow a smooth and safe flow of cross-border transactions, trade financial deals, mitigation of risks, cash flow management services, and security services. Transaction banking improves the relationship between banks, customers, and partners. It offers treasury solutions allowing a safer, secured, and effective flow of cash and financial securities across the international financial systems. It facilitates trade finance and offers cash flow management and securities for public and private entities.

The services of transaction banking are cash management services, online services, trade finance, and security services. Cash management service is a part of transaction banking that entities offer as a solution to manage the cash inflow and outflow effectively. Through online services, transaction banking provides a single point of cash access, trade, and security services to help streamline the workflow process for corporate, institutions, and small-medium enterprises. Transaction banking services for trade finance offer a range of global trade finance deals, including import and export services, buyer and seller financing, and open account receivable management. Through security services, transaction banking aims to improve the services and relationships between banks, clients, and partners.

In this article, we will explore why there is a surge of technology and innovation in transaction banking. We will track the evolution of transaction banking and highlight the business and regulatory issues. We will also investigate the scope of testing the transaction modules in banks and examine the products that are covered in testing the transaction modules and platforms.

Technology and Innovation in Transaction Banking

There is stiff competition in transaction banking that arises with changes in the regulatory compliances. With changes in regulatory requirements, banks and vendors are making considerable investments to remain competitive and ensure the quality of transaction banking platforms.

The banks no longer build their proprietary solutions. Instead, they rely on technology vendors to deliver corporate solutions. It significantly reduces costs and frees the internal resources to focus on more value-added services. Banks are investing to make the data easily available to companies and help them achieve straight-through reconciliation. Banks are focusing on collaborating with external vendors for payments. Mobile payment systems are emerging which is evident from different mobile payment platforms collaborating with Google, MasterCard, and Sprint.

Transaction banking is changing the relationship between banks and their technology vendors. Banks are improving their collaboration with the technology vendors to ensure that they offer quality banking services to the customers. Banks are utilizing the technology to the fullest to make their services flexible. With the inclusion of mobile technologies and Cloud services, banks are evolving and improving their services; banking services without these recent technologies now seem incomplete.

Evolution in Transaction Banking

Banks have reorganized their internal operation to improve different transaction banking units. The current structure unifies cash management and trade finance activities. The evolution of transaction banking has had a significant impact on the banks’ service lines. The quality of products and services like trade finance, payments, supply chain, cash management, liquidity management and more are now improved with the technology used for transaction banking.

Large corporations are using the effect of globalization on the economy to manage their cash and liquidity. They have standardized their finance processes by creating regional shared service centres and executing centralized back-office systems across regions. The earlier payment factories that used to process payments have now evolved into extensive corporate transaction banking systems utilized to manage the transaction flow between the partners, banks, and clients. Technology has helped corporates to manage and use their internal cash flow more efficiently. They have improved the visibility of cash transactions. But one area that can be challenging for treasury is to gain access of the cash once it is identified.

The situation can be grave in the countries where there are some rules imposed on tax. It prevents the easy movement of liquidity outside of the country. To facilitate this movement there are many large cash management banks present across countries that advise their clients and leverage the network to offer them value-added services. It offers greater visibility to the corporate treasurer over their cash status. They can manage the cash movement and access the cash without being worried about adverse situations. The organizations can reduce the need for short-term borrowings by up to 30-40%.

Working capital is extremely important for organizations since the liquidity risks can turn an organization into bankruptcy and counterparty risk is rising high. It is not just enough to have funds for a corporate they must manage the funds to make it more accessible and visible.

Liquidity Risk & Counterparty Risk

Liquidity risk and counterparty risk are the two common types of risk that transaction banking face. When an individual investor, business, or financial institution cannot meet their short-term debt, it raises the concern of liquidity risk. On the other hand, counterparty risk arises when the second party in credit, trading & transaction, and investment cannot fulfil their role in the deal and becomes a defaulter in a contract. An effective liquidity risk management and counterparty risk management program help banks meet their obligations to pay within due dates to avoid adverse scenarios.

The Scope of Testing Transaction Banking

The scope of testing transaction banking is spread across the area of its services. The service line of transaction banking is the flow of cross-border transactions, trade financial deals, mitigation of risks, cash flow management services, and security services. The scope of testing transaction banking includes testing the cash management, payment transactions, supply chain finance, collection and receivables, trade finance, and back and front office transaction banking modules.

Transaction banking is available through multiple sources and channels. Testing transaction banking includes testing the transaction origination medium like bank branches (back office and front office systems) and channels (internet and mobile).

Yethi’s Testing Approach and Methodologies

At Yethi, we have worked with some of the major national and international banks. We have tested prominent transaction banking applications. From User Acceptance test design & execution to regression testing and performance testing, we have conducted end-to-end testing of different transaction modules. We have also executed security testing of all the transaction banking applications.

We have tested the following modules,

  1. Payments
    1. NEFT/ RTGS/IMPS
    1. Bulk Transfers
    1. A2A Transactions
    1. UPI/NACH-based transactions
    1. Instrument Series
    1. Tax Payments
    1. ECS
    1. Products Maintenance
  2. Supply chain Finance
    1. Vendor Finance
    1. Dealer Finance
    1. Payable Finance
    1. Receivable Finance
    1. PO Finance
    1. Reverse Factoring
    1. Export Factoring
  3. Collection and Receivables
    1. Collections
    1. EOD BOD Reports
    1. Receivables
    1. All other Reports
  4. Trade Finance
    1. Bill Collection,
    1. Letters of Credit,
    1. Bank Guarantee
    1. Open Account for Trade,
    1. C2C Transactions for Trade
    1. B2C transactions for Trade

We follow strategic testing methodologies and execute testing in phases across different modules like Payments, Supply Chain Finance, Collections and Receivables, and Trade Finance. Our testing method includes identifying various business processes in the bank and customizing software based on the volume and value of transactions supported by each process.

Our testing focuses on the processes deemed to be at high risk, based on an algorithm built in conjunction with the bank. We design and execute test cases based on our analysis. We offer end-to-end and improved test coverage across all the modules and products in transaction banking. We help banks in identifying the defects at the early stage, thereby minimizing the defect leakage risk. We detect rare issues and errors and increase the overall productivity of the application.

Rising Customer Risks in Digital Lending, how efficient test automation can help?

The traditional lending process was time-consuming as the time for credit appraisal and disbursal used to be around three to four weeks, and the average time for account/money processing used to be approximately 60 – 70 days. In the traditional lending process, customers have complained that due to 30 days of the moratorium, the EMI would have started way ahead of the lending amount credited in their account. Often, customers used to opt for 6o days of the moratorium to avoid the inconvenience.

Soon organizations realized the need for digitalization to reform the lending process. Leading banks worldwide adopted digital lending to slash down the processing time to 24-hours. Digitalization brought a transformative change to the entire lending process. There has been a significant shift in end-to-end credit journeys, including the customer experience. Digital transformation has supported the credit processes. Digital transformation has improved revenue growth and achieved significant cost savings.

Digital lending allows customers to submit loan applications online. From applications, to documentation, verification and amount credited to your bank account, the entire process is carried out on mobile applications, and it takes less than a day to credit the principal amount to the customer’s bank account. From three weeks and 60-days, the time to cash is now reduced to 24-hours.

Rising customer risk in digital lending

Banks are enhancing the process by adopting paperless loan approval. They are automating the entire process to improve time and quality. But digital advancement has its own limitations. There is a rising concern for customer risk associated with digital lending. Customers share account details, personal information, credit history, and more on these applications. Hence, organizations must ensure that they maintain the stability, security, performance, and accessibility of these platforms.

The organizations are currently digitizing the credit and lending process. The banks are focusing more on improving customer experience by reducing the time taken for lending process. While organizations reduce the lending time, there is a major concern arising from customer risk. Let us look into the types of customer risks associated with the digital lending process.

  1. Multi-layered transaction process – The digital lending transacti0n is multi-layered as various lending services are outsourced to different entities. Multiple Fintech companies operate behind the operation to create a platform for transactions. As the customer uses these tech platforms for transactions, it becomes increasingly complicated in the cases of grievance redressal, like who will address the customer complaints, what actions should be taken and by whom to ensure that the services are more effective.

The platforms are integrated by embedded finance that forms a layer of services by different fintech modules. These platforms also work based on an algorithm that matches borrowers to lenders. While this algorithm creates efficiencies because several activities are performed simultaneously in a broader lending spectrum by outsourcing it to many Fintechs, there can also be certain drawbacks. If the borrower has appointed a defaulter as a guarantee, Fintech will address the loss. However, at the time of collection, customers will face many challenges.

  • Irregularity in information during loan origination process – The terms and conditions in the lending process are lengthy. The lending process becomes complex because not all organizations will have similar terms and conditions; some will have more than others. It increases the customer risk because customers may not have thorough knowledge and understanding of the repayment terms while signing the loan agreement. The customers may not comprehend the information like the interest rate, processing fees, overdue charges, annual percentage rate and more if not informed by the lenders. They would also not know the consequences of repayment delay, credit score impact, and implications of NPA.

Customers are also not aware of the payment recovery actions that organizations adopt. All this inadequate information makes borrowers make uninformed choices and affect their credit ratings. The loan disbursal is quick in digital lending, but without adequate information about the charges and consequences of non-repayment, the risk will increase.

  • Effects on unfavourable credit history – The previous point brings me to the current one that if the customers are not informed about the adversities of repayment delay or repayment overdue for months, it will affect their credit records. Most customers are not even aware that non-repayment or delays can affect their credit eligibility for future loans. Once the credit score is evaluated low, the customers must take multiple measures to rectify them or obtain credit approval to avail future loans. A low credit profile can lower the credit records making it difficult to apply for a new loan.
  • Lack of communication and transparency on assessment of creditworthiness – Digital lending, unlike the traditional lending process, which follows a thorough process of evaluation of customers’ credit profiles, does not engage in interaction with the customers, which is a requirement to analyse the customers’ creditworthiness. Digital lenders spend a lot of time on automated IVR, text messages, and social media advertisements to create awareness and push their services. Borrowers are not even aware of how the lenders have procured their contact details and credit history. It is not even clear how the lenders have evaluated the credit eligibility of borrowers. It creates a lot of confusion regarding whether it is spam or a genuine approach.

Like traditional lending, digital lending also considers two important aspects of the lending process; the customer’s willingness to pay and the ability to pay. While the first intention is evaluated through the customer’s previous credit history, the second intention is evaluated by the customer’s salary credited in the bank account, debit and credit history, investments, liabilities, and more. While applying for a loan, the digital lenders request access to contact details saved on customers’ phones. The lenders use this alternate data model to cross-verify borrowers’ credibility and positive intentions.

  • Lack of suitable assessment device – It is easy to avail of loans digitally as the processing is quick. But there is a lack of borrowers’ credit worthiness assessment that complicates the entire lending process. Often lenders provide top-up loans based on the timely repayment by the borrowers without a suitable assessment. This added loan sometimes may not flow well with the borrowers, and they may end up in high overdue.

The overdue reason could be the high-interest rates imposed within a short loan tenure. Several instances in the past highlighted that customers ended up being loan defaulters, and organizations had to contact them and force them to repay the loans. The collection process in digital lending happens digitally (mostly auto-debit). If customers miss one EMI, it will lead to a serious outcome, and lenders might look for alternative ways to recover the loans. Both borrowers and lenders face harassment.

  • Lack of grievance redressal – Digital lending lacks promptness in addressing customer complaints. In fact, the grievance redressal is not as quick as the loan disbursal process in digital lending. It also lacks transparency for customers, which their trust in digital lending. The digital lending ecosystem evolves multiple service layers offered by many fintech, making the customer interaction complicated and confusing and finally leading to failed redress. For most lending fintech, the only option for redressal is either through an integrated chatbot or WhatsApp chat sessions, which have certain limitations and do not always suggest adequate information. All these increase the intensity of redressal issues, and customers face problems.
  • Risk of compromised personal data – The unique selling feature of digital lending is how they gain access to customers’ personal data and use these alternate data for customer onboarding and credit appraisal processes. But it can be equally detrimental if the data points are sourced from external data agencies. Sometimes the borrowers sign two agreements in case the digital lending happens through a third-party service provider. In the above kind of agreement, the first signed agreement would be between the borrower and the lending app, where the lending app would be entitled to a different entity.  This structure allows the third party to gain access to customer data to collect all necessary information. These sourced data can be misused without the knowledge of the customers.

Why testing is an important digital lending platform?

Let us consider a scenario; you enter all your details, and suddenly the application stops responding with a notification message for you to close the application. You have to turn off the application, unaware of whether the application has recorded the details you have already entered. Or, you upload your documents and click your image, but the image does not get saved. The digital lending platform might have to contact the customer to inform about the missing information and ask them to upload all details again. Customers relate to the digital lending platform because of its seamless functionalities, easy navigation, superior performance, and security. If any of these is compromised and has errors, customers would not think twice about discontinuing using the application.

As per a report in Statista, “Digital lending is one of the fastest-growing fintech segments in India and grew exponentially from nine billion U.S. dollars in 2012 to nearly 110 billion dollars in 2019. It is expected that the digital lending market would reach a value of around 350 billion dollars by 2023”. We can imagine the growth of digital lending in the upcoming years with a 13.5% CAGR. The projected data give us an idea that the number of the digital lending platform will increase, which implies that it would need rigorous testing to ensure that the platform is top-notch without any technical errors. Each Fintech must also ensure that no organization loses their business to their competitors due to technical glitches of applications.

Let us investigate how efficient testing can improve the digital lending experience.

  1. UI/UX and integration – Customers seek platforms that are easy to use and navigate. Testing can evaluate a clean UI design and integration point to ensure that the customers enjoy a seamless experience of the lending platform.
  2. Performance – It is a massive turn off for customers if the application stops responding or if there is a performance error. Performance testing can ensure that the digital platform eliminates the possibilities of performance issues in the lending application.
  3. Accessibility and functionality – Customers relate to applications with easy accessibility and functionalities. They will not prefer using an application filled with features and functionalities. It confuses customers with the click-boxes and fields that do not allow them to navigate through the window command. Functionality testing helps detangle the application so that customers can easily access the applications and ensure that the platform performs at an acceptable standard.
  4. Security – Security is an important aspect of a digital lending platform. Customers share data with an expectation that the platform will maintain customer data confidentiality. The digital lending platform must ensure that the security of borrowers’ details is not compromised. Security testing can ensure that digital lenders maintain data security under the proper protocol.
  5. Regression – Changes, modifications, and addition to the digital platform are extremely frequent. Each change implemented in the application can harm the entire application functionality if not validated properly. Regression testing ensures that the new features are integrated adequately and correctly without disrupting the previous application features and functionalities.

Conclusion – Test automation is an effective solution to scrutinize the workflow of digital lending systems workflows. It validates the end-to-end process and saves time and effort for each implementation. Digital lending platforms have a high degree of inter-connectedness, which requires repeated testing to minimize manual efforts and achieve optimal coverage.

At Yethi, constantly upgrade and update your LOS and digital lending platforms to make them flexible and agile. The major challenge in testing these systems includes usability, performance, security, UI/UX, and Configuration. With Yethi’s robotic, 5th generation codeless test automation solution, Tenjin and deep domain expertise, the experts address the above challenges. Our team help banks and financial institutions drive their testing operation and ensure that their customers achieve their business goals within the stipulated timeline. Our intuitive solution – Tenjin, reduces 60-70% testing turnaround time.

Testing the fastest growing Financial Management Systems

Financial transactions are a part of our daily lives. How we manage our assets, income, and expenses must all be recorded in a system. A business must see its present and future i.e., debit and credit accounting, to ensure that they are compliant with the industry’s accounting standards. It is the reason that every organization must have a financial management system to record the financial transactions and provide a genuine report whenever needed.

The least you would expect is not to leave your customers dissatisfied without a proper financial management system (FMS). FMS is software used by organizations to manage assets, income, and expenses. An FMS reduces accounting errors, maintains audit trails, and remains compliant with appropriate accounting standards.

A financial management system must have the following features to qualify as an appropriate system for every organization.

  • Maintaining the transparency of all payments and receivables
  • Calculating the asset depreciation over the time
  • Tracking the liabilities
  • Maintaining the data integrity and security
  • Updating the reports/records
  • Managing multiple bank accounts
  • Managing and repaying prepaid expenses
  • Reducing overall paper records and paperwork
  • Organizing income and expense statements and balance sheets
  • Maintaining the audit trail accuracy

Purpose of financial management systems

The purpose of the financial management system is to keep a complete record and help the organization determine how to acquire and distribute funds, make critical financial decisions, enhance profits, increase the company value, and maintain business stability. Financial management forms the core of every organization. The organizations use financial management systems to manage their income, expenses, and assets with the objectives of increasing profits and ensuring sustainability.

The responsibility of an effective financial management system is to improve the short- and long-term business performance. The software helps streamline invoice and bill collection, removing accounting errors, reducing record-keeping redundancy, and ensuring compliance with tax and accounting guidelines and regulations. FMS helps in quantifying budget planning and offering flexibility and scalability to accommodate change and growth.

As a part of growing financial management software, the software can also include features like supporting the creation of ad hoc reporting, month-end, quarterly, and year-end closing report generation capabilities.

Testing financial management systems

Financial management systems carry a massive responsibility of managing, tracking, and reporting financial decisions. Organizations cannot afford to go wrong with FMS. Organizations need support with strategic test designing, test planning, and test execution across the entire software development lifecycle.

The organization must consider different project stages to ensure maximum quality at different stages. There must be a thorough requirement analysis, followed by planning and scenario designs. In the test design phase, reviews are collected, the Internal Quality Audit Team (IQA) are leveraged, and the designed test cases are reviewed periodically by SMEs and domain knowledge experts. Test cases are built based on designs, followed by test executions. Ensuring quality is an essential requirement in a test execution phase. In this phase, detailed entry and exit criteria are evaluated, and defect status is reviewed periodically.

For extensive software such as financial management systems, it must undergo end-to-end testing to ensure the software quality.  A financial management system must be evaluated under different stages during the software testing lifecycle. These evaluation criteria include requirements assurance, integration assurance based on application suite and system landscape, functional assurance based on user acceptance, and non-functional assurance based on application performance and security. It is also important to automate test execution wherever applicable and conduct regression testing to eliminate redundant test cases.

Conclusion

At Yethi, we have successfully executed an FMS testing project for multiple clients with over 450+ branches and 300+ branches across the country. We have empowered many businesses with our proprietary 5th generation codeless test automation tool – “Tenjin”, and a repository of 850K+ test cases. Our clients have already reaped the benefits of the FMS integration testing solution with their existing Core Banking System model. We have successfully covered 4000+ test cases on different platforms.

10 Important Aspects to Consider While Testing Mobile Banking and Internet Banking Platforms

Testing mobile and internet banking platforms are essential in the current banking landscape. Customers no longer wish to continue with brick-and-mortar banking. They avoid visiting banks and standing in long queues as they know that the banks will meet their requirements even from a remote location. This daily dealing and transactions are now pushed to an extreme, where banking seems impossible without mobile platforms. Of course, inadequate performances of mobile banking have various consequences, and there is no room for pondering whether the mobile and internet banking platforms need testing. The answer to the question will always be a big “YES”.

Indian millennials totalling 440 million, compose 46% of the workforce and contribute 70% of the household income. An average millennial checks his smartphone once every 15 minutes. Digitisation has made it easier for millennials and other banking customers to access their banking accounts 24/7 without waiting in long queues. Mobile banking and internet banking have reduced the cost of banking and streamlined processes to deliver more value to customers. The key to gaining a competitive advantage is customer-centricity in banking applications.

Banking applications and software have complex structures which incorporate a wide range of features and ensure security to all its users, while ensuring a seamless and user-friendly experience. If a banking application is released full of bugs and errors with performance issues, it will damage the credibility of the bank. Banking has essentially become a multichannel provider, and a successful testing strategy is testing cloud, mobile, internet and other aspects of the banking applications to ensure proper performance.

Let’s look at the ten aspects that banking applications (mobile or internet banking) must consider while testing the platform

  • Total coverage of workflow and business requirements
  • The functional aspects of the application
  • The security aspect of the application
  • A fool proof disaster recovery programme to protect users from unfair practices
  • Data Integrity
  • User application, support service sectors and facilitate payments through multiple gateways
  • Integrate well with other apps, including billing apps, credit cards, and trading accounts
  • Fast processing of secured transactions
  • Increased storage capacity of banking apps
  • Be user-friendly, support users across all platforms and on all devices
  • High auditing capability to troubleshoot customer issues

Testing Internet banking platform and mobile banking platform for banking apps

While testing banking applications, one of the important issues to address is data complexity. Banking applications store all sorts of private information, data, passwords, and assets of the customer in the backend. The backend databases should not be affected by malware. Testing ensures that the data is protected. The bank should have an automation tool to check data connectivity continuously. Data connectivity testing is tested over a virtual private network continuously. This will ensure that the private data is safe. The following testing methods are recommended for internet banking and mobile banking platforms:


1) Privacy governance: The most common privacy governance model that is used in data protection is a decentralised model where different business owners within the organisation are responsible for data protection matters within the scope of Indian data protection laws and   requirements, stay compliant and being proactive in solving issues. They should have expert knowledge of the data protection law and its governance and the ability to fulfil the tasks set out in the regulation. There will be various areas such as legal, IT and others involved in this process.


2) Functional testing: The design and configuration of the banking apps have to be perfectly configured. In reality, many banking apps are designed and configured imperfectly.

The testers of the mobile and internet banking platform have to understand that all the modules and the system function as designed by developers while testing the app.


3) Performance Testing: Performance levels consist of infrastructure, backward integration, and connectivity. Performance failures plague both internet and mobile banking. There should be regular administrative oversight of transactions happening during regular interim periods. Load and stress tests should be regularly performed so that transactions have multiple supports at the same time. The performance of the banking app comes under pressure during festival times. User experience is affected when there is a performance failure of the banking app. It could be as simple as cyber/IT failure leading to incorrect balances showing in the customer accounts. This leads to mass panic. The banking app must obviate such potentialities.


4) Integration testing: Users use many different channels and internet connections, and testing should consider the fact that the performance of the banking app in different channels is uniform.  Banking apps should integrate with programs used by customers without difficulty and without creating hurdles and complexities. When different system modules interact on the customer’s mobile banking app, there will be bugs and errors, so the testing teams must be cautious about bugs and incompatibility impairing the performance. Some bugs are detected in the early stages of the software development life cycle. Bugs could be due to a broken database schema or a wrong cache integration. Integration testing is necessary to understand the variations in the developer’s logic against the software requirements. It is also necessary to validate the modules’ interaction with the third-party tools and Application Programming Interface. There is a multiplicity of mobile devices, used by the bank’s customers in the marketplace. The multitude of customer devices using different platforms and networks must be tested. As this is a complex process, the automation must be planned properly.


5) Accessibility testing: Users of mobile apps may suffer from various physical problems which include being partially sighted, being dyslexic, suffering colour blindness, movability issues relating to their fingers, suffering from arthritis or other issues like using a small screen. The mobile app should be user friendly as much as possible. Testing screen readers, analysing colour ratios, html validator, inbuilt accessibility options, WCAG 2.0 checkpoints, site readability and navigation will ensure better accessibility.


6) Usability , Usage and Acceptance testing:  Usability testing must bear in mind the needs and requirements of a different group of customers. The design of the banking app should therefore be simple. It should be tested among different groups of people as not all will have technical skills. The banking app should be user-friendly and easy enough to use so that even the luddite is able to use the banking app easily.
Acceptance testing ensures the mobile apps with their various features are accessible to the end-users and also for business needs. This type of testing could use a black box type of testing of end-users to make the app more user-friendly and accessible to end users.


7) Data Migration testing: This testing checks whether all data has migrated with integrity from the source platform to the destination platform. This is particularly necessary when data is migrated from legacy systems to the newer applications. Testing has to ensure the integrity of migrated data.


8) Security testing: Security testing is one of the most important aspects of testing the banking app. Banking apps are prone to fraud and phishing attacks. Vulnerability scanners and penetration testing can help in this process. Testing procedures must ensure that all international security standards are followed. The privacy governance in mobile banking apps is key as it interfaces with several other third-party applications. Trojan horses could be hidden in free games which can steal the user data. That is why several authentication factors are put in place before a customer can access his mobile banking app. The Operating system and network vary across various user mobile devices. Testing must adhere to all platform, network, and operating system security standards.

Mobiles are susceptible to theft and loss, malware, and malicious applications; there is also a lack of maturity in fraud tools and controls. There are also SMS, fraud, and operating system vulnerabilities. Testing should control these risks and ensure compliance with all security protocols.

9) Regression testing: Most banks are continuously innovating and adding new features to their banking apps. When mobile banking apps are modified, the changes can have unexpected consequences. Regression testing aims at making sure that no bugs or functionality impairments are caused due to such modifications. Regression testing is crucial for banking apps as they enable banking transactions and use the protected private data of customers. Therefore, regression testing of all updates to the mobile banking app is essential.


10) UI/UX testing: In this type of testing the testers must make sure how buttons, fields, toolbars, colours, fonts, and icons respond to the user input. Testers need to make sure that the mobile app, software, or platform responds perfectly to the end-user.

Key Takeaways

Testing mobile and internet banking platforms can be a complex and demanding process but experienced users can employ strategies that can help banks and their clients secure a vulnerability-free mobile app and a user-friendly interface. The mobile banking app and the internet banking app solution provided by the bank should be a secure, user-friendly app which is free of bugs and errors, where the user can navigate between various pages/screens with minimum difficulty and make a seamless 24/7 banking experience a true reality. The importance of the role of testers and other software specialists in transforming this dream into practical reality cannot be understated.

5 Common Misconceptions About Test Automation

With the world moving towards digitalization, people expect things to swirl around in the blink of an eye. There is no room for manual errors and the time to fix those errors are even less. It only makes sense to shift to automation testing, as it has proved to be a boon and not a bane for organizations. Automation and automation testing have exceptionally benefitted industries with a massive customer base, voluminous data, less time for market launch, budget constraints, and fewer human resources. Maintaining quality assurance (QA) of companies’ software assets with automation testing is essential.

Especially in banking and financial industries, where companies cannot afford to go wrong with a loyal customer base, a large amount of data and fixed deadlines, automation testing is effective, cost and time efficient. Every time the QA team identifies a bug in the code, the testers perform a routine test across the application to ensure its quality. According to the Transparency Market Research report, the global test automation market is expected to expand at a CAGR of 15.4 percent by 2025. As per Transparency Market Research’s expectation, the automation testing market will grow from 30.45 billion USD in 2016 to 109.69 billion USD in 2025. With such demand and growth, there are bound to be questions. In this article, we will address the top five common misconceptions about test automation.

 What is Automation Testing?

It is a software testing technique that leverages specialized tools or automated scripts to automate the execution of test cases, making software testing more efficient. On the other hand, manual testing requires human effort in the form of sitting in front of the system and validating as well as executing each line to check for bugs. This testing methodology is beneficial because it automates repetitive operations and performs a few other testing techniques that would be difficult to achieve manually.

We can convert practically all manual testing into automation testing using tools and automated scripts. Test automation comes in the following forms:

Let us take a closer look at the various myths and misconceptions concerning test automation that users have.

 5 common Test Automation misconceptions:

  • You can automate all the test components: Test automation has proven to be an effective technique to reduce manual testing and tasks. That does not imply that the QA team can automate all their testing operations. We must remember that all automated testing is based on code, which is nothing but imitating manual tests. The QA team is aware of several manual parts that are not always possible to include in automated script-driven testing. Furthermore, testers are informed of which test segments to prioritize and which to test using automated testing.
  • Automated testing is more expensive than manual testing: It is only partially true. The company’s initial investment in automated testing is higher. Purchasing test automation tools or developing automated test scripts, as well as hiring testers to run those tools, are the expenses. However, this is a minor outlay that saves time and money in the long run. The QA team can save a lot of money if they implement automated testing adequately. Manual testing requires more testers and more time, extending production time and increasing the cost of testers, development efforts, and consequently, late product delivery. Over time, the company can differentiate between the execution costs of automated testing and manual testing. Time is more valuable than money. Hence, automated testing is not as expensive as companies believe.
  • Automating the test is easy: Every organization understands that development is challenging and time-consuming and implementing automated test tools and scripts is even more challenging. Enterprises and firms that can perform precise test automation can have a competitive advantage in the market. If an enterprise does not perform test automation well, it is more likely to lose money and time. Automation testing is not easy since the QA team must decide whether to use automation tools or design personalized scripts to make the test more productive. Many automated testing tools on the market are promoted and purchased on the assumption that internal testers will be able to use them without any training. The major attribute of such testing applications is the ability to automate the collection and replay of numerous manual test cases. When it comes to maintenance, the easy-to-construct aspect of the development is inherently brittle and challenging.
  • For increased automation, you need more engineers: This is another myth and misconception that prevails in the development industry. Adding more engineers or even testers to a test automation will rarely result in a positive development effect. In fact, a team of two or three testers can easily manage multiple test projects for a corporation as automation testing does not require much manual observation or human intervention. Again, the misconception is partially true because the team can perform a large number of tests in an automated manner initially. However, as the product under test changes, which is common in the rapid development ecosystem, a considerable amount of testing maintenance is required. More engineers are hired in this area. However, companies are limited in their ability to add more resources.
  • One must be a developer to write or perform automated testing: Yes, the company occasionally or once in 4 to 5 years requires a developer to write the automated test script. However, most test automation is practised using automated testing tools, which the testers can execute these test tools. Testers do not need to have hard-core programming knowledge and expertise. Just the basic knowledge of testing and programming and understanding of how to use those tools and apply them to various testing situations are all they need. The QA team must choose the finest testing tool for executing and supporting the automated tests. However, there might be situations where the testing tool available on the market does not meet the QA team’s requirements. In such scenarios, companies can hire automation scriptwriters or outsource the scripting project to third-party firms or freelancers.

 Conclusion

Delivering consistent product quality is critical to a software development firm. At the same time, firms should reduce the time it takes to promote a product. Automation is a boon for the development firm in this case. The software development and quality assurance industries should avoid the myth to understand the benefits test automation renders in the software development sector.

Yethi’s 5th generation codeless test automation solution, Tenjin is an enterprise platform. The robotic capabilities of Tenjin enable to learn and adapt to the application and its updates. Tenjin, is a plug-and-play banking aware solution, continuous testing, minimizing the manual effort and speed up the test execution regardless of the complexity and number of updates.

Risk-based testing for bug prevention to bug detection

The primary intent of conducting software testing is to uncover the bugs, assess them, and identify the associated risks. This approach will enhance the software cycle-over-cycle, mitigate risk, and allow smooth business operations to reflect an improved business revenue.

The testing volume increases faster than deploying the new functionalities. There is no need to test the old capabilities frequently to ensure that the new functionality doesn’t create any discrepancy in the system. Also, various stakeholders might have a different view of “risks” than developers or testers (not just probability of failure, but impact); hence, it becomes critical to carry out risk-based testing for bug prevention and detection.

Risk-based approach helps,

  • Identify high-risk areas
  • Direct testing efforts
  • Early detection for high-risk failures
  • Lower regression errors (no degradation in functionality that was working)

Testing of pre- and post-development codes help in identifying and resolving the bugs in the system; thereby, it will help mitigate risks quickly and efficiently. It is to be noted that risk-based testing is not limited to bug prevention and detection alone. After the complete code of the software is written, the testing experts can also identify issues based on their expertise, knowledge, and experience when the software is in the development or designing phase. However, no software should go without risk-based testing in the deployment phase, as it can cause technical issues or corrupt the database and applications.

Difference between Bug Prevention and Bug Detection

Bug prevention and bug detection in software are two different constraints with regards to the aspects of before the code is written and after the code is written, respectively. Bug prevention is the practice of discovering issues before the coding for any software is completed. With bug prevention, concerned individuals can rethink the design so that the code possesses the ability of risk mitigation.

On the other hand, bug detection is the practice of uncovering unknown risks during and after the code is written concerning the impact of other distinct constraints on code. Through bug detection, coding teams can make changes in real-time to enhance the scope of software utilization and avoid any probability of encountering issues.

Concept of Risk-Based Testing – bug prevention and detection

Risk-Based Testing can be explained as a basis of prioritization of the test cases that are to be conducted on software. By documenting the significance of function, its likelihood of failure and impact in case of failure, testers can focus their efforts on areas that can have a significant negative impact.

The process of bug detection comprises analysis, prevention, and management, which will ensure that all the bugs and defects are identified and resolved before the software reaches the final users and prevent it from causing any issues in their system.

Further, bug/defect analysis, prevention, and management practices ensure that all the bugs/defects go through a pre-determined life cycle to be fixed and closed. The nature of the bug depends upon the resources it uses, and the effects cause the software to behave abnormally. The goal of bug analysis, prevention, and management practices is to identify the root cause and treat them. 

The root cause of the bug occurrence generally contributes to the factor of the bug. It needs to be mitigated and resolved to eliminate all the probability of recurrence of the concerning defect. However, the coding team needs to make sure the elimination of root causes should be affecting the performance of the software in any way.

The bug prevention and detection in the risk-based testing process concern the risk containment and mitigation aspects for the risk management process. The risk management process ensures that software is prepared to mitigate the risk whenever it arises during the risk-based testing process. It is based on predetermined programming that can minimize the adverse impact.

Risk Monitoring and Controlling

Risk monitoring and controlling is the process of tracking all the identified risks, such as monitoring residual risks, detecting the new ones, assuring risk plan execution, and evaluating the software ability and effectiveness to eliminate the risks. The risk monitoring and controlling process works throughout the software development life cycle by recording the risk metrics related to the implementation of contingency plans.

While carrying out risk-based testing, 75% of risks arising in test cases can be monitored and controlled, whereas 25% of risks in the test cases may remain undetected due to lack of exposure to application functionalities. Risk monitoring and controlling is a continuous process as new risks may arise by adding new functionalities in the ongoing software development lifecycle. An efficient risk monitoring and control process aims at providing necessary support. It ensures that all risk-based testing practices and robust communication are adapted for making effective decisions to mitigate risks proactively.

Overall, it can be stated that risk-based testing and its varied practices and processes ensure that software is deployed for use by the final users without any bugs or defects. Risk-based testing carries out the practices for bug prevention, bug detection, defect analysis, defect prevention, and defect management for eliminating every possibility of software misbehavior at the user’s end.

Risk-based testing also documents every risk and its triggers so that a risk mitigation plan can be executed as soon as any risk occurs, or trigger is activated. Risk-based testing works in real-time as it starts with the planning phase of software and ends when software is deemed ready for deployment after all the testing. Real-time working of risk-based testing ensures that all the bugs and defects are eliminated from the root causes before they adversely affect the performance of the software at the users’ end.

Yethi is your go-to all your software QA needs

Even a minor bug can adversely affect the software quality putting the brand reputation at stake. An excellent testing process can improve the quality of the software. At Yethi, we follow a process of risk categorization and prioritization. We offer automated business process simulation for high-risk areas to increase the efficiency, accuracy, and consistency of the banking/financial software.

We select test scenarios based on importance to customer & security, financial impact, the complexity of business logic, and integration points. Being a leading QA partner for banks and financial institutions, we have touched base in over 22 countries offering QA solutions for more than 80 clients worldwide.

Yethi’s test automation platform, Tenjin, is a 5th generation robotic platform that can efficiently carry out even the complex testing process with ease. It handles test execution, test management, and defect management at various stages to ensure accurate test results with excellent performance without compromising the critical aspects.

Importance of Automated Regression Testing

As technology is advancing, the software gets subjected to various new and improved features. Such integrations may cause errors/bugs in the system not allowing it to function accurately. Hence, regression testing is conducted to test the entire software to understand its behavior upon the addition of new integrations and identify any bugs arising due to the same. This is true for even minor code changes or any alterations made across the process. Simply put, regression testing ensures that the software or the piece of code that was previously developed and tested still behaves in the same way after the code has been changed or altered.

Carrying out regression testing manually can be a tedious task, and due to its mundane and repetitive nature, manual regressions may not be fruitful. Hence, regression testing is automated to ensure consistency and accuracy while avoiding human errors.

Significance of Automated Regression Testing

Incorporating manual regression testing can be a draining experience as it involves a lot of time and effort. Further, its tedious nature is prone to causing high errors. With the ever-changing technology, the process is getting complex and manually handling regressions cannot be considered a feasible option. Including automated testing as a part of the product development strategy is what most organizations are doing today.

Automation testing yields the best outcomes with optimal time and resource requirements. It focuses on conducting accurate regression to create products of higher quality, which in turn will offer a seamless customer experience. It streamlines the process, improves workflow efficiency, delivers the effective solution, and speeds up turnaround time.

Benefits of implementing automated regression testing:

Saves Time and Effort: Automated regression testing can handle repetitive tasks effortlessly and efficiently in lesser time, hence, saving significantly on time, cost, and effort.

Reliability: Automating regression testing will reduce human errors considerably while ensuring accuracy and consistency on the outcome. Their accurate and consistent nature makes the process reliable compared to manual regressions.

Tests running round the clock: One of the major advantages of automating regressions is that tests can be initiated and executed any time, i.e., tests running 24/7 and results being generated constantly.

Cost-effective: The reusable nature of test cases significantly reduces the cost of test case generation, making the whole process cost-effective.

Improved ROI: Automating regressions may seem to be a little more expensive than including expenses for buying tools, initial setup costs, and investing in writing test cases. However, this maybe a one-time investment; it yields good results in the long run adding to improve ROI metrics.

Early detection of bugs: Testers will be able to spot problems and defects earlier in the software development cycle thanks to automation.

Steps involved in Automated Regression Testing

Choosing the suitable test cases

Choosing which tests to re-run for regression testing is a combination of technology awareness, clarity on requirements, and intuition. Whether you’re performing priority testing or subset testing, the goal is to increase the likelihood of triggering any regression that has been introduced. Choosing the right test case from the repository is the most critical step that determines the success/failure of the testing process. Choosing the right test case is an indication that half work is done successfully, the rest remain in executing it with the right tools.

Regression test execution

Before the advent of autonomous testing, ensuring that your tests are effectively scripted is a prerequisite for good regression testing. If a test requires the system to be in a specific state, try sequencing tests to reduce the number of times you must change the state. Make sure your test suite produces data that is straightforward to understand. It should be simple to figure out which cases were unsuccessful and what the system was up to at the time. Occasionally, you’ll see apparent failures resulting from incorrect configurations.

Maintaining regression tests

Like any other tool, automated regression testing is only as good as the people who use it. And, like any suitable instrument, it needs to be cared for and maintained. When new test cases are produced, consider whether they should be included in the regression tests. “Does this bug need to be added to the regression testing?” you should ask yourself whenever you patch an actual bug in your code. In most circumstances, the response will be “Yes.” You should, however, include tests that check the functionality of any new code paths.

Why Is Automated Regression Testing Right for Your Project?

Organisations build software applications to provide value to the customers. With time, these applications need change, or the developer may look to add more functionalities and features to the software based on the customer requirements. With each change in code or functionalities, the app becomes more and more complex. Hence tests for regression issues should be added more frequently with every update. Automated regression testing could be a boon for such organisations.

Here are some of the reasons why automated regression testing could be suitable for your project:

  • get higher test coverage
  • get continuous results
  • higher test efficiency
  • fast results
  • reusability of tests

Yethi for Automated Regression Testing Solutions

Yethi is the market leader in offering software QA solutions to global banks and financial institutions. Yethi’s test automation platform, Tenjin, is capable of handling efficient regression testing for complex banking and financial system. It has proven to offer nearly 100% accuracy in regression scenarios, and its half-a-million test case repository cuts immensely on the cost.

Tenjin is a 5th generation test automation platform with robotic UI capabilities which can automatically learn and relearn without manual intervention. It offers high test coverage and has the ability to test even the complex banking/financial system with utmost ease.

[INFOGRAPHIC] Manual Vs Automated Testing

Software testing has evolved from tedious manual testing processes to automated solutions. As software development processes are getting complex and moving towards a more agile approach, manual testing can be time-consuming while lacking accuracy and consistency due to its mundane nature. To ensure the quality of the software is the best, organizations are adapting test automation solutions that will also significantly reduce time, cost, and effort.

Take a look at the below infographic to understand the difference between Manual and Automated Testing, and decide which one to choose.

 

Manual Vs Automated Testing

Though, automation testing is preferred by most of the organizations today, manual testing cannot be eliminated from the process completely. Manual testing is required to set the initial automation process. However, automated testing is best suited for regression testing, repeated test execution, and performance testing.

Software Testing Efforts – Both Manual and Automated

The technological trend is changing at a faster rate than we anticipated. With this changing technological landscape comes the need to constantly update new and old systems for security, regulations, and market risks. For example, many financial companies have recently started moving towards offering cryptocurrency services, which are highly unregulated and volatile. Thus, companies need to incorporate robust software testing methods to ensure that their updates and new product offerings meet the industry standards while offering a seamless customer experience.

The standard component of software service includes:

  • Application workflows
  • Datastore and validation
  • UX and performance
  • Security and fail-safes
  • Integrations and 3rd party dependencies

These services are offered to a large customer base, across multiple channels and devices, in real-time and at a 24/7 availability while also navigating compliances on privacy and data protection. It means shipping an application from start to finish requires efficient stakeholder management and robust component testing at every step.

To successfully test these complex software, companies have to rely on Test management or Quality Assurance software that offer both manual and automated testing solutions. Let’s discuss the goals and approaches for both the testing methodologies.

Manual Testing

Manual is all about testing the application using a manual approach. The testers use this process to identify issues, check core functions and find out areas that require deeper attention. The execution process has a high degree of flexibility and helps structure the next steps in the testing process. However, manual testing is a slow process that is hard to scale. It is important in the early development cycle as the test environment evolves quickly.

Manual tests were traditionally managed through spreadsheets and documents; however, using test management tools to keep a log of tests run and maintaining version control is the most efficient way to conduct manual testing.

Steps in Manual testing cycle:

  1. Defining requirements of test on a document or test management tool
  2. Create a list of test cases based on the requirements
  3. Modify test cases based on outcomes and record results with detailed notes
  4. Identifying issues that were not accounted for in the initial plan

Key aspects of manual testing

  • Manual testing works better to execute dynamic and moderate scenarios.
  • Manual testing’s primary goal is to explore avenues that require problem-solving and check essential functions.
  • Manual testing is sometimes the only way to identify issues with the software, especially in the early lifecycle.
  • Manual testing is slow and inefficient when tests are simplistic and need to be run in high volume.
  • The quality of tests relies a lot on testers’ skills and knowledge.
  • Manual testing can never be eliminated from the process, no matter how advanced the automation technology may become. Every testing procedure, whether manual or automation, will require manual testing for initial set-up.

Automated Testing

Over the years, as the complexity of software increased, test management through manual testing is not able to cover ground as fast as delivery requirements need it to. Automated testing helps ensure rigorous product testing quickly, at a low cost, and offering higher scalability. When code is updated frequently, test cases are required to be re-run even for the functions that were not updated. It is to ensure that the update did not affect existing functionalities ‘regression testing‘ should be run frequently. Automating such repeatable test scenarios ensures time-saving and better end-product quality with less time.

Steps in Automated testing cycle:

  1. Defining goals, timeline, and requirements of the test results
  2. Creating relevant test cases and checking the feasibility
  3. If feasible, identify the right automation tool based on budget and need
  4. Executing the test cases and analyzing reports of the outcome

Picking the right automation tool is an extremely important decision and must account for:

  • The core and edge networks of an application, as they have different testing needs
  • Industry, for example, BFSI applications will have different priorities over an e-comm or lifestyle application
  • Lifecycle, established products will require more regression cycles compared to those in the initial development
  • Reporting features, since they help reduced time spent in analytics
  • Convenience, different teams should be able to adapt to the tool quickly

Key aspects of automated testing

  • Automated testing reduces time, effort, and cost to perform tests required for regression testing.
  • Automated testing requires an initial investment in software purchase and setting up the process, such as building the test case library.
  • Automated testing improves product reliability by covering a larger set of test cases frequently.
  • Automated testing cannot adapt to undefined variances and relies on the prediction ability of the tester.
  • It is necessary to deploy automated testing tools across all kinds of applications, especially in the stages before the final release.
  • Automation is necessary to run stress tests or performance tests.

Despite the differences in the approach of manual and automated testing, it is important to understand that both methods complement each other in refining the application. Manual tests are well-thought-out exercises that look for fundamental problems, discoveries, and learnings, whereas automated tests are mindless rigor that lacks decision-making but saves immense time, cost, and effort while offering accurate results.

Choosing an incorrect testing suite can cause several problems that snowball into millions lost in opportunity. Duplication due to redundancy, huge test backlogs, poor analytics, and lack of team collaboration features can slow down the entire development process in a growing competitive market. Data from many surveys suggest that many banking players are unable to meet new age requirements due to legacy systems and management tools slowing the system down.

Yethi’s test management solution for the banking and financial sector Tenjin by Yethi is a powerful test automation platform that supports a wide range of testing activities for banking and financial applications. It is built with a keen understanding of the space and requires minimal programming experience. With a diverse set of analytical and team collaboration features, it delivers high-speed operations with greater consistency. It is a 6th generation, robotic test automation platform that allows you to build and maintain test automation while delivering accurate and efficient results every time.

Exploratory Testing vs Automation: Why both should coexist?

Building an efficient testing strategy is an integral part of any software development process. The success of the software depends highly on QA as it improves the overall quality and efficiency of the software. There are several testing techniques and tools available, that are used by companies to improve the quality of their developed software. Testing tools reduce the number of test cases to be executed, increase test coverage, offer a nearly hundred percent test result, and help to identify test conditions that are otherwise difficult to recognize manually.

The advancement at the technological front has provided the tester with inexhaustible list of techniques for a detailed testing process within an agile ecosystem. Among the different techniques used by organizations, exploratory and automated testing are popular for the robust functionality and better user experience they offer. Though exploratory and automation testing have their set of advantages, it is important for them to coexist within a system for better outcomes.

Exploratory and automation testing explained

Exploratory testing is a kind of software testing where test cases are written during or after testing processes. The testers check the system on the fly and strategize to decide “what is the test objective” before the test execution. This kind of testing is widely used for testing agile models for effective results. Exploratory testing is a kind of playful activity for a tester to utilize their expertise and scale up their skills. During the exploratory testing process, the tester utilizes their skill to identify, explore, and learn more about the problems and objectives to perform software application testing in detail before planning, structuring, and performing actual testing.

Automation testing is a software testing technique where the tester usually leverages automated testing software tools to execute a well-defined test case suite. Unlike exploratory testing, automation testing involves less human intervention, which increases the coverage, and speed of test execution.

The need for exploratory and automation testing to work hand in hand

With the growing technology to offer convenience to the end-users, companies are investing in advanced development process. Such systems run on complex algorithms and requires specialized testing solutions to handle the complexity, increase accuracy & performance, and reduce time-to-market. Exploratory testing or testing with a loosely defined plan / objective is helpful in identify unexpected behavior. However, considering that “net-new” functionality often forms a very small portion of the overall software behavior, it is important that testing efforts cover “regression” to an extent that is required and economically viable.  Test -Automation helps increase the volume of tests that can be executed in a fixed period of time while reducing cost-to-test. 

Automation testing performs complete end-to-end testing, covering all aspects like user-acceptance, regression, performance, and security. They are popular for testing complex systems with ease and reduced time, without compromising on accuracy and consistency. Automation testing involves a detailed planning and execution protocol. On the other hand, exploratory testing focuses on minimal planning but explores an elaborate test execution process. They are most suitable for testing of multiple versions of a software using agile methodologies, and also suitable for features of an upcoming software.

Automation testing aims at working on test plans, test cases, test steps, and test results, while exploratory testing involves discovery, investigation, and learning. Hence, when both of them go hand in hand, it is likely to create a software with minimal or no errors and working flawlessly. On the event of exploratory and automation testing coexisting, they complement each other and enhance the software with each version release.

The key differences between test automation and exploratory testing

  • Tester skill is a key to exploratory testing, and for automation testing minimal manual scripting is required for achieving expected results.
  • Exploratory testing emphasizes on adaptability and learning, whereas automation testing emphasizes on prediction and decision making.
  • Exploratory testing is an investigative procedure where testing modules can mold according to the tester’s spontaneous decisions for optimizing the testing methodology. In automation testing, the tester follows a predefined protocol by confirming all the testing requirements, so there is no scope of improvement in automation testing.
  • Exploratory testing is not random testing; it is ad hoc testing with a procedural approach to finding bugs and debriefing. Automation testing is an approach to use a framework of workflows for effective outcomes.

Yethi’s test automation solutions for banking and financial sector

At Yethi, we can conclude a wide range of testing activities for diverse banking applications. We deliver solutions leveraging both practices of exploratory and automation testing. Our team brings expertise at the intersection of banking operations and software testing, enabling us to understand the “business intent” of the software and design and execute a test-strategy to effectively and efficiently cover any software deployed within a banking/financial institution. Automation testing is best in testing cases for business-critical applications where test cases require repeated execution, which is often time-consuming. Yethi’s test automation tool, Tenjin, is a 6th generation, robotic test automation platform that allows you to build and maintain test-automation. Targeted at a business analyst, it is a code-less platform that can be leveraged by people with no programming experience.