Accelerating development of mobile payment apps with open source

Legacy banks, insurance companies and other financial services firms are facing an onslaught of challenges to their existing ways of doing business as a result of technology disruption from a raft of start-ups that give customers more options and flexibility. Both the current and emerging organisations have not only to develop mobile channels and apps as rapidly as possible but they must also constantly evolve and innovate these to give customers more flexibility, control and better service. For legacy organisations this rapid rate of innovation means looking closely at how application development is performed internally and how organisational structures and development processes need to change.

One area that new software providers are all too familiar with, and one which legacy organisations are starting to embrace to help accelerate software development, is the use of open source. Indeed, a recent study carried out by IT analyst firm Forrester of 542 developers suggested that as many as 92% of banks have been using open source software (OSS) to develop mobile apps. A recent whitepaper from SQS shows how using open source brings many benefits including reducing software development costs, bringing software to market more quickly and improving the quality of software. Black Duck Software suggests that open source software represents over 10 million person years of software development with more than 35,000 different components supporting mobile application development alone. 

However, as open source software can easily be downloaded from the internet free of charge by developers, the due diligence that would usually be overseen by the procurement department when bringing third party software into an organisation is not undertaken. The same whitepaper from SQS also highlights that the governance of open source usage, even in the best cases, means that less than 50% of the open source in use is actually known and often far less. The result is that open source is unlikely to be delivering the maximum business benefit and organisations are putting themselves at a competitive disadvantage and incurring unmanaged risks, ranging from legal and intellectual property risks to security and quality.

Organisations must explore how open source software and development techniques can support its business strategy. Once this is understood, clear policies and guidelines should be established to support this strategy. Finally, the changes to processes, tools and organisational structure to support the policy should be introduced. This approach will ensure that organisations can strike the right balance between the benefits that open source brings and the risks of having unknown and unmanaged third party open source code used in critical line of business applications.