As financial institutions adopt new technologies, many are facing increasing challenges in ensuring their software meets stringent compliance and security standards.
With core banking systems handling sensitive transactions and vast amounts of customer data, testing these systems for compliance has become a critical but difficult task.
Experts highlight that while automation and innovation in testing are key, banks are still grappling with the complexities of meeting regulatory requirements and ensuring robust software quality.
As the adoption of new technologies grows, particularly in core banking applications, the role of software testing becomes increasingly important, with functional and regression testing an absolute necessity for any major bank, according to one industry insider.
Ashwini Shivarudra, an experienced software quality analyst based in India, who has worked on a host of complex banking applications in the last decade, highlights the crucial steps involved in testing financial applications and ensuring compliance with regulatory standards.
Shivarudra points to the need for a comprehensive approach to the software Development life cycle (SDLC) and software testing life cycle (STLC), particularly in banking.
She stressed the importance of understanding financial processes in order to effectively test banking applications, which often include complex systems like money transfer systems, trade finance applications, and retail banking solutions.
“Testing in the banking domain requires a deep understanding of both business requirements and regulatory compliance,” Shivarudra explained.
“Core banking applications must not only perform as expected, but also adhere to stringent industry standards,” she added.
“This means testing both functional and non-functional requirements, such as performance and security, to ensure the system works correctly and securely.”
Functional combined with regression
One of the most important aspects of testing in the banking sector, according to Shivarudra, is the need for both functional and regression testing.
Functional testing ensures that core banking systems, like payment systems and trade finance functionalities, work as intended, while regression testing identifies any issues caused by new changes or updates.
Shivarudra also emphasizes the importance of compliance, particularly when dealing with sensitive financial data.
She noted that ensuring adherence to industry standards, such as SWIFT messaging protocols and security requirements for payments, is crucial.
“Banks must ensure their systems meet compliance requirements for security, privacy, and regulatory standards, particularly when handling sensitive financial transactions,” she said.
To effectively track and resolve defects, Shivarudra relies on tools like Quality Center, JIRA, and qTest, which help document issues and ensure clear communication between testing and development teams.
“Accurate defect reporting and tracking are essential for ensuring that all stakeholders are aware of potential issues and their resolution status,” she shared.
“Banks should test both functional and non-functional requirements, such as performance and security.”
– Ashwini Shivarudra
In addition to manual testing, Shivarudra points out the increasing importance of automation in the testing process.
By automating repetitive test cases, banks can increase efficiency, reduce human error, and ensure broader test coverage.
“Automation not only speeds up the testing process but also enhances the consistency and accuracy of tests,” she explained.
Tools like SymAuto, TOSCA, and Selenium IDE have become central to Shivarudra’s approach to automation, enabling quicker and more reliable results.
Finally, security and vulnerability testing are key to ensuring the protection of financial systems. Shivarudra underscored the need for regular collaboration between testing teams and security experts to conduct vulnerability assessments and penetration tests.
“Banks must be proactive in identifying and addressing security risks to prevent breaches that could compromise sensitive customer data,” she stated.
As financial institutions continue to embrace new technologies, the ability to ensure robust testing practices is more critical than ever.
Shivarudra was keen to stress the importance of a well-rounded approach to testing: one that incorporates functionality, compliance, security, and automation.
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