How to Create a White Label Bank with Modular System

Account holders of the top 4 white-label banks WeBank, Rakuten, Nubank, and Revolut, amount to as many as 710 million account holders. That fact fully supports other statistics, indicating that the global digital banking market is projected to grow at a CAGR of 54.8% up to 2030. 

It doesn’t come as a surprise that businesses increasingly start looking to adopt white label banking services and products. But how do you approach such a project and carry it out at a reasonable investment cost? 

In this post, you’ll discover what white label banking can offer to your fintech or non-fintech business. Besides, you’ll familiarize yourself with Fintech Core and explore how to create a white label digital bank MVP or adopt finance services on an example of an actual white banking product.  

What White Label Banks and White Label Banking Can Offer 

White label banks are pre-built, customizable banking solutions provided by third-party financial technology companies. These solutions enable businesses to offer banking services under their own brand without having to build the banking infrastructure or obtain a banking license themselves.

Examples of white label banks:

• Pi-1
• Revolut
• ClearBank
• Marqeta

And let’s find out what actually white label banking has to offer for other businesses, both from fintech and non-fintech domains: 

B2B white label banking services:

• API integrations
• KYC and KYB Compliance as a service
• Account opening infrastructure
• Card issuing infrastructure
• Payment infrastructure
• Risk management and fraud detection

Note: The mentioned are exactly the offerings of white label banking providers to businesses. In other words, that’s what needed to get started with, for example, integrating a lending feature into a non-banking app, aside from front-end development. The very B2C services for end customers, like payment processing or lending, are described in detail further in the text. 

How Modular System in White Label Banks Works

Many neobanks, similar to most other complex fintech solutions, are built using the modular system. It’s because this architecture patterns provides better scalability and flexibility, especially when API integrations are many. 

There’s no single modular architecture template. Instead, there are principles by which architectures split functionalities into manageable parts, from which the entire software system is then architectured using low coupling, high cohesion, and other principles. There are typically distinct modules, clusters of modules, or larger modules with smaller integrations and bits of development solutions, and, surely, flows of data channeling all of them together.

Discover what the modular architecture may look like visually in the infographics below:

A real-life modular architecture example is provided further in the text. 

Explore additional nuances on how modular software architecture works compared with monolithic architecture in another blog post by DashDevs. 

In the case of white-label banks, the modular architecture looks like this:

1. Core banking system as the foundation
2. A library of modules, each responsible for a distinct suite of functionalities, as building blocks
3. API integrations
4. User Experience (UX) layer
5. Security and compliance protocols

This logic is widely applied. Yet, different white label solutions can be built by using custom modifications of this system. One such custom solution is Fintech Core by DashDevs, details on which I provide in the next section. 

Modular Structure in Fintech Core by DashDevs

Fintech Core by DashDevs is a modular fintech platform for the fast development and launch of white label banks and digital banking white label services. 

When delving deeper with DashDevs’ partners deeper into Fintech Core, I like to show what it actually is a two different angles:

Technical perspective: FinTech Core is a core banking layer plus a library of modules, a UX layer, and a suite of pre-integrated providers as well as licenses and compliance protocols.

At the same time:

Business perspective: Fintech Core is a custom solution, banking functionalities of which can be selectively integrated into products, or, alternatively, which can be utilized to create and launch a neobank or a white label banking feature in short terms. 

Explore more about Fintech Core and how it compares to Revolute, another famous fintech product, in our blog post. 

In the section above, I shared preliminary details on how modular structure in white-label banks works and looks like. Now, the time is just right to reveal the modular architecture of Fintech Core, which is the approximate architecture for any white label products built on it as well.

In the infographics below, you can see a visualized Fintech Core structure with layers and distinct modules distinguished into clusters:

And here’s an explanation of the structure module by module: 

Layer 1: Foundational (Core) Modules 

In Fintech Core, foundational modules are ones that are present in our white label solutions in any build. They are hard-built into the software architecture and are not meant to be erased from it completely. 

#1 Authentication and authorization

The authentication and authorization module secures access to a banking platform by verifying user identities and controlling permissions. It includes mechanisms such as multi-factor authentication (MFA), biometric verification, and secure password management to confirm user legitimacy. 

Explore biometric authentication in fintech from the corresponding webinar by DashDevs. 

Authorization determines what actions users can perform based on their roles and access levels. This module ensures that only authorized individuals can view or manage sensitive information, reducing the risk of unauthorized access and enhancing overall security.

#2 Customer and onboarding

The customer and onboarding module automates data collection and validation to reduce manual efforts and onboarding time. It provides admin functionalities and real-time approvals on the back end as well as a user-friendly interface on the front end. This module is responsible for the acceleration of users’ adaptation to the white-label banking product. 

#3 General ledger 

General ledger technology is a comprehensive accounting record that systematically tracks the movement of funds between the account balance and server balance. It logs all transactions within the system, enabling detailed analytics to assess how balances have evolved over time and to review all historical transactions.

The ledger is designed to work with various accounting systems and manage all entities that require tracking, including: 

• Credits or liabilities
• Cryptocurrencies
• Traditional bank accounts
• Equity
• Any other asset with a balance

The general ledger maintains a unified record of all white label financial services, as well as assists in preparing financial statements, tracking financial performance, and ensuring accuracy in accounting. That’s why it’s the foundation of a white label banking solutions. 

#4 Transaction history and reporting

The transaction history and reporting module allows users to view, filter, and analyze their financial activities with comprehensive details. It provides real-time tracking of deposits, withdrawals, transfers, and payments, presenting them in an organized and searchable format. 

There may be integrated advanced reporting features that can enable users to generate statements, export data, and gain insights into spending patterns. 

#5 Notification and alerts

The notification and alerts module is responsible for delivering timely information about account activities. It can be tuned to support:

• SMS notifications
• Email notifications
• In-app messages
• Other multi-channel notifications
• Alert notifications

Customizable alert settings allow users to receive updates like transaction attempts, login attempts, and potential security threats based on their preferences.  

Layer 2: Orchestration (Complementary) Modules

Orchestration or complementary modules in Fintech Core are modules that can be replaced with some other custom solution. They may also be erased completely from the software architecture if the functions they are responsible for are not needed. 

#1 KYC + KYB

The KYC (Know Your Customer) and KYB (Know Your Business) modules are technically combined into one module cluster in Fintech Core. It automates identity verification for both individuals and businesses. KYC and KYB module also help to ensure compliance with AML (Anti-Money Laundering). Among others, this module fulfills the following functions:

• ID verification
• Business registry checks
• Risk scoring.

KYC and KYB module also has a backoffice API, which is basically admin environment allowing to manage other modules. 

#2 Banking accounts

The banking accounts module manages multiple types of accounts, including savings, checking, and business accounts. It supports real-time balance updates, account statements, and account customization. This module offers management of user funds and seamless integration with other financial services.

#3 Core banking

The core banking module serves as the backbone of the platform, managing the creation and operation of user accounts, from which payment details are retrieved for transactions. It handles all banking activities, including:

• Account management, transaction processing
• Business logic execution
• Compliance
• Initiation of transactions
• Integrations with payment providers

#4 Payment processing

The payment processing module facilitates secure and swift transactions, including ACH, SEPA, SWIFT, and card payments. It manages payment routing, authentication, and settlements, ensuring a seamless user experience. This module supports multiple currencies and payment gateways for global reach.

You may be curious to explore how payment gateway differs from payment processor from another DashDevs’ blog post. 

#5 Card issuing

The card issuing module in Fintech Core is powered by solutions like Stripe. It enables the creation and management of physical and virtual cards, handling all card-based payments through seamless integrations with card issuing providers. It supports:

• Custom card branding
• Setting spending limits
• Instant card issuance

Integrated security features such as tokenization and PIN management enhance protection.

Explore card issuance nuances in another blog post by DashDevs. 

#6 Foresight exchange and cross-border transactions

The foresight exchange and cross-border transactions module simplifies international payments with real-time exchange rates and reduced fees. It supports multiple currencies, compliance with global regulations, and automated FX conversions.

#7 Open banking

The open banking module facilitates secure API-based integration with third-party services, allowing users to access a wider range of financial products. It ensures compliance with PSD2 and other regulations as well as have means to adapt to future regulations, like upcoming PSD3.

Explore PSD2 and PSD3 and what it means in the payment sector in another blog post by DashDevs. 

#8 Risk and fraud management

The risk and fraud management module employs AI-driven analytics to detect suspicious activities and mitigate risks. It includes features like transaction monitoring, behavioral analysis, and fraud risk scoring.

#9 Customer support

The customer support module integrates live chat, in-app messaging, and ticketing systems to provide timely assistance. It can be tuned to support AI-powered chatbots as well as a human-operated support center.

Important note: Some of the Fintech Core modules need to have integration with external providers while others don’t. If a mobile should have an integration, then we need to create a separate extension with a provider to it. We build solutions in a way that it’s both time and resource-effective to create such extensions due to having the same internal business logic regardless of the particular provider. So, should you need to switch, for example, from Stripe to Marqeta for your card issuance module, we can do it without any issues. 

Layer 3: Cloud or On-Premise-Based Software Architecture 

The modular structure in Fintech Core can be deployed either in cloud or on on-premise services. We utilize Kubernetes as core for the entire software architecture.

Kubernetes is an open-source platform for automating deployment, scaling, and management of containerized applications developed by Google and is now maintained by the Cloud Native Computing Foundation (CNCF).

Here are three providers of cloud computing technology on which we can deploy white-label bank or banking functionalities:

1. Amazon Web Services (AWS)
2. Google Cloud Platform (GCP)
3. Microsoft Azure

As you can see, those are three most popular cloud platforms. So, regardless of your cloud needs and considerations, at least one of these proviers can cover them. We also possess substantial experience with AWS, Google Cloud Platform, and Microsoft Azure.

Explore cloud and DevOps services that the DashDevs team provides at our corresponding service page. 

As I claimed, Fintech Core offers the opportunity to host your white label banking product directly on-premise. 

On-premises app infrastructure encompasses to the hardware, software, networks, and storage systems that are physically located within an organization’s facilities rather than hosted in the cloud.

Here at DashDevs, we can both build and deploy your white label solution on already dedicated servers, or help prepare necessary infrastructure and deploy an app afterwards.

How to Create a White Label Bank MVP with Fintech Core

Fintech Core is designed to be accessible for all businesses, including non-tech ones. With it, the development of your white label banking platform MVP can be done in these 6 stages in under 2 months:

#1 Preparation and setting up

The DashDevs team provides the necessary code and documentation for the white-label solution. We gather information for providers to be integrated and front-end needs for the project. At this stage, we providean estimation of resources needed to integrate one or other banking service providers. 

#2 Technical implementation

Either the DashDevs team or your in-house team implements the MVP, which includes: 

• Writing extensions for each chosen third-party provider.
• Updating and fine-tuning some modules, if necessary.
• Integrating the white label solution with the customer’s software system in place.
• Testing the white label banking software solution

#3 Front-end development

Fintech Core doesn’t have its own front end because, typically, every fintech product has its custom front-end. That’s why at this stage, the DashDevs team or the customer’s dev team builds the front-end components for the white label banking solution. It can be done either on the basis of the existing front-end system or from scratch. 

#4 Deployment

The DashDevs team, deploys Kubernetes on either a cloud server, by AWS, GCP, or Microsoft Azurem or on an on-premise server. 

#5 Adaptation and training

The DashDevs team assists the customer’s team with adapting to the new software solution. We provide both support and maintenance, as well as in-house development, customer support, and other team training. 

#6 MVP is ready to scale

The created software solution may then be scaled to a fully-fledged white label bank. It may necessitate introducing more features by adding other modules available, fine-tuning and reinforcing front-end, and adding more providers to existing modules to enable different, for example, payment options, etc. 

How to Add a Banking Functionality to Your Non-Bank Product With Fintech Core

Aside from creating a white-label bank from scratch, Fintech Core offers additional opportunities. As such, we may integrate most of the banking functionality into your fintech or financial app, as well as into any of your non-financial products. Technically, it’s executed similar to creating a white label bank MVP, which I described above.  

Pro note: Integration of banking business functionalities falls within the embedded finance concept. Here at DashDevs, we may provide embedded finance development using any external integrations. But what’s even better is that we offer to leverage Fintech Core for this very purpose. Advantages are provided in the following section. 

Here’s the scope of white banking financial institution services or functionalities we can integrate with Fintech Core in your fintech or non-fintech product:

• Payment processing
• Card issuing 
• Banking account opening
• Digital wallets
• Investment management
• Savings accounts
• Credit scoring
• Loan management
• KYC (Know Your Customer) verification

As you can conclude, Fintech Core can cover most, if not all, needs to add financial services into fintech or non-fintech applications. 

Get started with Fintech Core

Advantages of Fintech Core over Traditional Development

The DashDevs team designed Fintech Core with actual business pain points in mind. We aimed to address concerns like high investment costs, long development timelines, difficulty choosing vendors, standard compliance, licensing, etc. Here are several advantages of our unique product that make it stand out from competitors and position it as a better choice compared to custom development:

• Affordable solution, compared to custom development. White label banking solutions with Fintech Core can be developed at lower investment costs. While the development of a neobank from scratch may cost as much as $300,000+, FIntech Core can offer a product of the same quality at less than one-third of that expense. 
• Accelerated time-to-market. With Fintech Core, the DashDevs team can create a white label MVP or financial service integration as fast as within 1.5 months, compared to customer development which may take 9+ months. 
• Proven solution that has been utilized in numerous projects. Fintech Core lies at the foundation of dozens of DashDevs’s projects, such as Pi-1, UK-based neobank. The technology is well-tested and has the necessary documentation. 
• A wide network of pre-integrated providers. For each functionality, e.g., payment processing, card issuance, KYC, etc., Fintech Core has selected providers like Stripe, Adyen, and others. It makes choosing partners and integrating them much faster. Full compliance is ensured. 

In a nutshell, Fintech Core is a well-thought-out solution focused on specific paint points. It addresses common concerns of business owners looking to start a white label bank or add a banking or finance functionality in their non-fintech product. The entire development, from preparation to release, can be carried out within a few months, and there are little to no drawbacks to such a solution. 

Final Take

White-label banking offers a cost-effective and scalable way for businesses to enter the financial services market quickly. By leveraging modular systems, companies can customize and integrate essential features like payments, compliance, and user management without building from scratch. 

Should you need to integrate white-label banking services or even to develop a white label bank or neobank from scratch — don’t hesitate to reach out to the DashDevs team. With more than 14 years of experience, over 100 fintech product development, and our own white label solution, Fintech Core, we can cover your business needs end-to-end. 

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