Popular digital banks like Revolut, Chime, and Wise enable quick mobile account openings. Beyond online banks, traditional banks have also launched digital spin-offs, reduced operating costs, and boosted revenues over the last decade.
What is a digital bank?
"A digital bank is a financial institution that operates primarily online, providing services such as account opening, transactions, and customer support through digital channels like mobile apps and websites - Brett King"
What does online banking mean?
Online banking defines the offer of banking services over the Internet, allowing customers to perform various financial transactions remotely. This includes activities such as checking account balances, transferring funds between accounts, paying bills electronically, and accessing account statements.
What are digital banking services?
Digital banking services encompass a range of financial offerings accessible through digital channels such as mobile apps, websites, and online platforms. These services include account management, fund transfers, bill payments, mobile check deposits, budgeting tools, loan applications, customer support, and access to financial education resources.
Digital banking software enhances the accessibility, comprehension, and management of these traditional services. In the contemporary era, this shift from traditional banks to digital banks was majorly fueled by COVID-19 and its impacts on the daily lives of people. The growth of digital banks and software is only expected to follow an exponential curve with time.
How to develop a digital banking platform?
Building a digital banking platform is a very laborious process and involves several resources, this is where PayNet Systems with its expertise in providing a digital banking platform, comes in. We assist our valuable customers by providing them with super-customizable digital banking platforms that can be deployed at a 10x faster speed, through features that include:
Agile Technology: Our low-code solution is quick to deploy and adapts to the requirements of your growing business.
Fully Managed Scalability and Security: You can easily orchestrate customer journeys across every touchpoint with the help of contemporary, microservices-based architecture.
Fully Customizable Turn Key Apps: PayNet offers ready-to-configure applications that enable Banks, Credit Unions, and FinTechs to go to market quickly.
Get started with your digital banking platform at the fastest pace and with high-end security. Click here to discover more.
Digital banking and online banking: are the same?
Digital banking and online banking are often used interchangeably, but they have slight differences. Below is more understanding differences in the table:
Key Points | Digital Banking | Online Banking |
Access | Comprehensive suite of online & mobile banking services | Primarily internet-based services |
Services | A broad range, includes smart tools, personalized insights | Core services like transactions and account monitoring |
Flexibility | Offers a more flexible and diverse range of financial services | Limited compared to the broader spectrum of digital banking |
Security | Robust security protocols, advanced encryption | Standard online security measures |
Cost | May offer cost savings through lower fees and reduced transaction costs | Generally cost-effective, but fewer advanced features |
Availability | 24/7 availability, anytime, anywhere access | Primarily operates during traditional banking hours |
The benefits of digital banking for users
As digital banks proliferate, understanding their modern solutions becomes vital for accessing superior and cost-effective services. Below, we outline the key benefits of digital banking.
Convenience: Digital banking offers unparalleled ease by enabling users to perform transactions and manage accounts from the comfort of their homes or on the go, without the constraints of traditional banking hours or the need to visit a physical branch.
24/7 Access: Unlike brick-and-mortar banks, digital banking services are available 24/7, allowing users to conduct transactions, check balances, and access support at any time, providing unparalleled flexibility and convenience.
Cost Savings: With digital banking, customers can avoid many fees tied to traditional banking, such as ATM withdrawal fees and paper statement charges. Also, the reduced overhead costs for banks lower fees and higher interest rates for users.
Personalized Financial Insights: Digital banking platforms often provide personalized insights and recommendations based on users' spending habits and financial goals, empowering them to make informed decisions and improve their financial well-being.
Alerts & Notifications: Digital banking platforms provide tailored alerts like low balance warnings, unusual activity notifications, and payment reminders, empowering users with financial control and security enhancements.
The types of digital banks
1. Neobanks: Neobanks, or digital banks, operate solely online, using advanced technology to provide a customer-focused and innovative banking experience. With 24/7 accessibility and intuitive mobile apps, they cater to the needs of a digital-savvy generation, offering personalized and agile banking services without physical branches.
Neobanks are well-equipped with fast-paced and secure software the likes of which include PayNet Systems. Our software includes every requirement to build a Neobank from scratch so that our valuable customers can go to market quickly
2. Challenger Banks: Challenger banks, as digital disruptors, offer customer-centric services, reshaping traditional banking with technology and agility. They redefine banking in the digital era, providing a dynamic financial experience.
3. New Bank: Fully licensed neo-banks like Revolut, Monzo, N26, and Starling Bank offer a complete range of banking services exclusively online, differing from traditional banks solely in their fully digital operation mode.
4. Mobile-Only Banks: Mobile-only banks, also called neo banks, operate solely through mobile apps, catering to users who prefer smartphone-based banking. Without physical branches, they offer streamlined, technologically-driven services, revolutionizing money management with convenience and innovation.
Conclusion
In conclusion, digital banking represents a transformative shift towards convenience, accessibility, and innovation in the banking industry, shaping the future of financial services.
FAQ
What is digital banking?
Digital banking digitizing traditional banking services for 24/7 accessibility on mobiles and computers, turns the industry with online channels.
What is the meaning of digital banking?
What is the difference between digital banking and online banking?
What are the examples of digital banking?
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