For QA professionals in the financial services sector, the pressure is more intense than in any other industry.
Whether supporting a multinational bank or a regional credit union, the stakes are high: even the smallest software error can lead to massive consequences.
A glitch in an online payment system can affect thousands of customers, and a regression bug in account processing might trigger a compliance breach.
Unlike in other sectors, the cost of failure in financial services isn’t just financial, it’s reputational, regulatory, and potentially legal.
As digital banking and mobile banking applications surge in popularity, financial institutions are under increasing pressure to release software faster than ever.
However, Robert McNeil, a senior manager at SmartBear, stressed that maintaining world-class quality and security while speeding up delivery is no easy feat.
“The core banking solution is the heart of every financial institution, and it must be optimized and well-tested,” McNeil explained. “If these systems fail, the entire operation of a bank can be compromised.”
At the center of this challenge lies the core banking system, which handles essential functions like account management, transaction processing, loan origination, and payment execution.
Leading solutions such as Temenos, FIS, and Oracle Flexcube are responsible for powering the most critical operations in banking.
However, many of these systems are old, highly customised, and deeply integrated with everything from customer portals to third-party fintech services.
McNeil noted: “The challenge in testing these systems isn’t just about verifying interfaces; it’s about ensuring that complex, regulated workflows operate smoothly from start to finish.”
Types of testing
Testing core banking software is a complex endeavour. It goes beyond simply verifying user interfaces or inputs and outputs; it involves ensuring that essential workflows like account openings, loan approvals, and end-of-day batch processing function correctly.
McNeil highlighted several types of testing that are essential for financial services: functional testing, integration testing, regression testing, performance testing, and visual validation.
“Manual testing simply cannot scale to meet the needs of today’s fast-paced banking environment,” McNeil stated.
“Banks are now pushing out updates on a weekly or even daily basis. Automation is crucial to keep up,” he added.
Despite these clear benefits, McNeil identified several key pain points in banking software testing. One major issue is the reliance on legacy technology, which many banks continue to use even as customers demand mobile-first, AI-enhanced services.
“QA teams are caught in the middle, trying to integrate old systems with modern demands.”
– Robert McNeil
Additionally, McNeil pointed out that a large portion of regression testing in banks is still done manually, which can take days or even weeks.
“This creates significant bottlenecks that delay releases and limit test coverage,” he explained.
Another critical challenge is the fragmentation of tools and skill gaps within teams. “Some teams use Selenium, others rely on spreadsheets, and many have no-code testers working alongside developers using Java frameworks,” McNeil said.
This fragmentation leads to inefficiencies and slows down progress. He also emphasized the compliance burden on financial services testers, noting the complex regulatory landscape that includes requirements such as DORA.
“Testers must prove, not assume, that these controls are working as intended,” he added.
According to McNeil, compliance is a crucial area that financial software testers need to be mindful of. QA professionals in banking must validate that systems not only function correctly but also meet critical regulatory requirements, such as data privacy, audit trails, and transaction integrity.
“Without thorough testing, financial institutions risk violating these regulations and losing the trust,” McNeil warned.
Looking ahead
Looking forward, he urged QA leaders in financial services to move from a reactive to a proactive testing strategy.
“Modernizing regression testing with automation is no longer optional. Banks must automate their most critical workflows, such as account setup and loan approvals, to run nightly or with every deployment,” he asserted.
In addition, McNeil recommended adopting continuous testing throughout the development cycle to catch defects early and reduce costs. “The earlier you catch a defect, the cheaper it is to fix,” he said.
One of the most significant trends McNeil highlights is the need for unified testing strategies.
“It’s time for QA teams to break down silos and standardize a core set of tools that work across both automation engineers and manual testers,” he suggested.
“Look for platforms that offer no-code options for business users while still supporting scripting for complex use cases.”
“It is critical to test for model fairness and reliability.”
– Robert McNeil
McNeil also advocated for the use of synthetic test data, which helps protect customer data while still enabling thorough testing.
“Production data is often off-limits due to privacy concerns,” he said. “AI tools can now generate realistic, privacy-compliant datasets that allow teams to test safely and effectively.”
Finally, McNeil emphasised the importance of testing for emerging technologies like AI and mobile platforms.
“AI is already being used for fraud detection, customer support, and even underwriting. It’s critical to test for model fairness and reliability,” he explained.
“At the same time, with mobile devices now being the first point of contact for many users, testing across real devices is essential.”
In conclusion, McNeil sees an opportunity for financial institutions to turn software quality into a competitive advantage.
“For QA leaders willing to modernise, there’s a unique chance to not only meet regulatory demands but to build trust with customers and accelerate releases,” he said.
“Robust, automated, compliance-friendly testing can help financial institutions catch more bugs, release faster, and improve the overall quality of their software,” McNeil concluded.
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