Digital only banks: Can Robo-Bankers Beat Humans?

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Digital-only banks have become a trend in the banking industry due to the recent technological boom. Traditional banking adds digital innovation like AI to make a digital bank. 

Digital banking has an upward adoption trend among individuals & entrepreneurs. So, banking would be digital, not a bullish statement. 

Now, should I choose a digital bankWhat would be the financial benefits of transferring from traditional banking to digital one?  

You have questions that mean you are interested to know about digital banks. Am I correct? If your answer is yes, then you are in the right article. This blog article guides everything that would be helpful for all types of professionals. 

Let’s start with the following. 

Key takeaways:

  • Digital bank uses advanced technology to reshape traditional banking.
  • Digital banking provides more flexibility with lower fees.
  • Digital banking could be an excellent option for freelancers or remote workers.
  • Digital bank has fast transaction facilities with a solid security system.
  • You will get instant banking services via a robot or human. 

What does digital banking mean?

Digital banking means the management of your money through updated technology. Digital banks charge less fees compared to traditional banks. Usually, digital banking solutions are best for remote workers who travel often to a different country for business purposes.

Let’s consider a scenario, 

Charlotte is a remote worker who loves to travel to different countries. She wants to balance her work & travel hobby, so she looks into an easy banking solution.

Isabella is running a management consulting startup that requires frequent travel to different cities in different countries.

So, both want a banking solution that doesn’t require a physical presence. Mobile banking would be the best fit for Charlotte because it will provide instant banking service with a bot 24/7 without a physical presence. 

Online banking would be the best option for Isabella because she can access the bank’s website through her computer without physical presence.  

Both Charlotte & Isabella fall under digital banking services because they are taking banking services with technology. So, digital banking is a combination of online banking & mobile banking. 

Fintech digital banking?

Fintech digital banking is the combination of financial technology & digital banking. Fintech uses advanced technologies such as AI and blockchain to secure payments. Besides traditional banking, it processes international banking, digital wallets, bitcoin transactions, and any digital asset payments.

For example, Neobanks offers banking services in three ways: mobile, online & fintech

If you want the above three types of banking services, you don’t need to physically visit Neobanks; instead, you will get every banking solution online. 

So, all the digital banks are not fintech digital banks, but all digital banks are fintech digital banks.

Fintech digital banking

 Mathematically, Fintech digital bank= Fintech + digital bank [ mixture of both]

Fintech digital bank – Fintech = Digital bank [without fintech]

Fintech digital bank – digital bank = Fintech [ without digital bank]

Digital private banking?

Digital private banking is a special wealth management service for wealthy clients through digital channels. It combines updated technology to provide traditional private banking services with lower fees. 

For example, Elena is an entrepreneur with substantial wealth. She doesn’t have enough time to visit the bank for financial advice & solutions. 

So, Elena opens a digital private bank account at UBS Wealth Management. Now, UBS Wealth Management will allow her to use robo-advisory tools and human advisors with diverse investment products & services.

Elena will get all required banking solutions fast without a physical presence. In this way, she will save time & money. 

Consultancy digital banking?

Consultancy digital banking means providing specialized consulting services to a traditional bank or financial institution by a professional consultant. These consultants will help to implement digital banking solutions, update technology such as AI, product development & many more. 

For example, Accenture is a consultancy digital banking firm that provides consulting services to many financial institutions. Usually, if regional banks have found increased customer demand but cannot satisfy customers by traditional banking methods, they will decide to hire Accenture to digitalize their services. Digitalized service will help regional banks provide better customer solutions quickly and accurately.

Digital banking verification code?

A digital banking verification code is a unique temporary code sent to the user’s phone or email address to verify identity. Usually, when you try to do any financial transaction by entering your site, you must pass a code to identify you as the owner. 

Digital banking verification code

Say, Jean has a digital bank account of Chime. She wants to pay her clients a bill from her account. So, Jean logs in to the account to process the transaction. 

In this case, Chime will send a code to Jean’s mobile number or email address to verify identity. After passing code verification, Chime will allow her to pay the client’s bill.

Numerica digital banking?

Numerica digital banking refers to online & mobile banking solutions provided by Numerica Credit Union. Numerica Credit Union is a US-based financial institution serving Washington, Idaho, and Oregon.

However, Numerica Digital is not entirely digital. They have a physical branch with traditional banking services. So, Numerica Digital is a combination of digital banking & traditional banking.

Digital commerce bank?

Digital Commerce Bank is a Schedule 1 Canadian bank that uses advanced technology to provide banking services. They provide digital banking solutions solely to businesses with flexibility & security. 

Below, the table details what type of service digital commerce banks provide.

Service maneDescriptions
Payment solutionsElectronic funds transfer, Visa Direct, Interac e-Transfer
Card servicesFund transfer
Digital walletsYes, connect by payment and card networks.
Branch serviceOnly online
Numerica digital banking

Q2 digital banking?

Q2 digital banking is a software-based banking solution by Q2 Holdings. Q2 is a financial company that provides software-based monetary services to banks, credit unions, alternative finance providers & fintech companies. 

Below, the table details what type of service Q2 Digital Bank provides.

Offers nameDescriptions  
Software platform for financial institutionsProvides under Q2 Core platform. Service includes account management, online and mobile banking, lending, payments, fraud prevention, data analysis.  
CustomizationQ2 offers customization based on clients needs.
IntegrationQ2 offers enough integration options to manage financial operations.  
Consumer banking solutionsYes
Commercial banking solutionsYes
Digital loanYes
Q2 digital banking

Digital envelope system bank?

A digital envelope system for banks is a method that uses digital tools to manage your money. It works like a cash-in envelope but processes all your spending through a bank app or online banking system. 

Let’s see an example,

Emma distributes her weekly $1,000 into four segments: Transportation, food, shopping & others.

Other details,

  • Transportation = $150
  • Foods= $250
  • Shopping= $250
  • Others= $350

Emma can spend within the range of each category, i.e., up to $250 for food. After paying out from each segment, Emma can check how much money is left for each. Emma must deposit cash from her account to each segment if she wants to spend more.

Concluding Thought

Digital banks have more advanced features than traditional ones. It could save you time, money & financial stress. You don’t need to be one standing behind a long banking line.

However, before choosing a digital bank, you must read the terms & conditions of their services. You must understand what your responsibilities are & what the bank’s liabilities are.

Digital banking is a good option for all professionals, especially remote ones. 

Frequently asked Questions (FAQ)

Digital banking agreement?

A digital agreement is a legal contract between you & bank on how to use banking services. Usually, it describes the terms & conditions, responsibility & obligation of you & bank & what type of liabilities both of you have.

Digital signage for banks?

Digital signage for banks is a promotional method that uses electronic displays. Here, you will see banking service hours, loan rates, countdown, and main features of financial products & services.   

In a word, you will find everything similar to traditional static signs but in a digital way. 

Digital signage for banks

Disclaimer

The information provided in this article is author’s view & only for educational purposes. This is not a banking advice. This is not a sponsor post & not an investment advice. Do your research before making any important financial decision. Therefore, FinanceIdeas.org will not be liable for your financial loss.

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