What is digital banking?

As we transition into a digital world – in which more and more services are offered online – consumers’ expectations have changed. Where they previously would have had to go into a physical brick-and-mortar establishment to access a service, they now expect to be able to do so digitally, from their homes or on the go. Banking is no different.

In the past, customers would have to go into their bank or financial institution to make a deposit or to transfer funds between accounts. However, now, all of these traditional banking services can be performed online, even from a different country – this is digital banking.

While digital banking can be described as any traditional banking transaction performed online, there is more nuance to it than just that. As such, in this guide, we’ll cover everything you need to know about digital banking, digital banks, and their benefits for customers.

What is a digital bank?

A digital bank is a licensed financial institution that offers online banking services to its customers. Digital banks are often confused with neobanks. While neobanks are purely digital, meaning they have no physical branches, digital banks still provide in-person locations should their customers need to stop in.

How does digital banking work?

Digital banking works just like traditional banks, at least in terms of the transactions that can be processed. However, instead of going into a physical location, for example, to deposit a check, you can do so online. While most traditional banking functions can be performed digitally, there are some that might still require you to go to a physical bank or ATM, for instance, if you need to withdraw cash.

Digital banking is further enhanced by readily available customer support. Should you require assistance, digital banks often provide access to customer support representatives to help you carry out banking transactions digitally.

Digital banking technology

Digital banking is made possible by the technology that it employs, including mobile banking applications and websites. Through these, customers can perform practically every banking function that they can at a physical bank location. Furthermore, thanks to advancements in digital security, all digital banking transactions are as secure as in-person transactions, giving digital bank customers peace of mind that their money is safe.

What are the benefits of digital banking?

Digital banking provides a wide range of benefits for customers. Benefits of digital banking include:

• Convenience

The primary benefit of digital banks for customers is convenience. With digital banks, customers can easily open an account from wherever they’re located, even if they live in a city or country where the bank doesn’t have a physical presence. This enables bank customers to access all the benefits of banking, be it processing payments, paying bills, or transferring funds, no matter where they are located in the world. Through digital banking, customers can bank when and where they need to, right from their phone or internet-connected device.

• Financial inclusion

Since digital banks provide customers with access to bank services no matter where they are located, digital banking fosters financial inclusion. Financial inclusion means that everyone has access to the financial services needed to build wealth, such as access to credit, savings, loans, and equity.

• Access to secure banking resources

Many global citizens live in countries either without secure banking options or that have insurmountable hurdles to entering the financial system. Before digital banking, these people had little to no recourse for securing their money. Digital banks enable people all over the globe to take control of their finances by providing them with secure banking solutions, such as US bank accounts that are accessible around the world, even for non-residents.

• Round-the-clock access and support

Another convenient benefit of digital banks for customers is that they enable them to access their accounts whenever they need to. They can even start transactions outside of traditional working hours; however, they may not be processed until the following day. Additionally, when banks provide customer support outside of traditional working hours, customers can do even more of their banking when it’s convenient for them.

• Simple transaction interface

While customers would previously need to go into a physical bank and ask a teller to perform a transaction, with digital banking, consumers can see what is available to them online. This makes starting and carrying out transactions easier than ever.

What’s the difference between digital banking, mobile banking, and online banking?

If you’ve done any digital banking, you’ve likely heard about mobile and online banking as well. And while all these types of banking are similar, there are some key distinctions between them.

Mobile banking is any banking transaction that can be performed through a bank’s or financial institution’s mobile app. Most common banking transactions, like deposits and transfers, can be performed through mobile banking.

Online banking, on the other hand, includes digital banking activities performed on a phone or internet-connected device that doesn’t directly use the institution’s official app.

Digital banking, the broadest of the three terms, encapsulates both mobile and online banking. It is any banking transaction that is performed electronically.

Digital banking made easy with Zenus Bank

We offer a wide range of digital banking services, enabling our customers to take full advantage of the convenience, security, and freedom of US banking from around the world.

With a Zenus bank account, customers all over the globe can enjoy all the benefits of banking in the US without needing to be a US citizen or resident. Customers can send, receive, and manage their funds easily directly from the Zenus mobile app.

• Make fixed-fee payments with ACH, SWIFT, and Zenus Transfers
• Enjoy very low FX fees
• Eligible clients are offered a metal Zenus Visa Infinite debit card as a standard
• Easily view and manage card details and security
• Make payments right from the app

With a Zenus Bank account, you can manage your money, make payments locally or internationally, and keep track of your financial life easily from our mobile app. Download the app from the Apple App Store or Google Play and get started with a Zenus Bank account today.