The arrival of digital bank has started great innovations in the financial technology. This sector belonging to the fintech These are companies dedicated to the financial sector that combine technology and the Internet with finance.
From Fazil Neobank, a neobank dedicated to this sector, we will talk to you about the digital Banks, also known as electronic banks, how they work, their main characteristics and their benefits.
What is fintech?
fintech It is the combination of finance and technology, it is used to explain the changes in new technology. It is a sector made up of companies that use technology to improve financial processes. The term refers to a rapidly growing industry driven by consumer and business interests.
From the Mobile banking Even insurance companies, fintechs have become a huge industry through investment apps. It is expected that they will continue to grow in the coming years, so the support and adoption of technology by traditional banks will be decisive, in order to finally achieve the digital mentality they need to keep their business viable.
What is a digital bank?
The digital banks They are financial institutions that operate within the digital world, without having physical branches, since all services are carried out remotely through online platforms as they are electronic banks.
This type of bank has the same licenses to operate as a traditional bank. However, its services are online and are supported by technology formed by digital payment systems.
Currently they are not a novelty, they have more and more customers for their clear advantages. They have been adding services and functions thanks to the advancement of technology, generally improving digital banking.
Traditional banks have realized that electronic banks have become a great competitor. Therefore, they have started to provide online services.
How do digital banks work?
In traditional banking, to carry out any procedure, you have to go in person to your bank branch, under specific hours and often reduced. However, digital banks allow you to manage any procedure or operation remotely.
In addition, personal interaction in this case is minimal as everything is managed by the on line bank. Most of the services and operations can be carried out from the app or website itself.
Main characteristics of digital banks
- They don't have schedules No physical branches. They do not have schedules because being online, you can enter the application or platform 24 hours a day.
- They operate on pages websites and apps. Through mobile applications and web pages and using digital payment methods.
- Speed: they are much faster and more efficient. While in traditional banking to carry out any type of management you must sign 10 papers and spend two hours in the bank branch, in digital banks you only have to enter your application and that's it.
- Automation: Most of its processes are automated through scheduled payment schemes and data processing software, which helps the efficiency of its processes and services.
Fazil Neobank VS Traditional Banking
Below, we show you a comparison with the main differences and similarities between a digital bank, in this case Fazil Neobank, and what we know as traditional banking.
Provides financial services
Innovative Practices and Procedures
Agile and accessible
Easier to innovate and correct systems that do not work.
100% digital service
Access 24 hours a day and 7 days a week
Use of technologies such as machine learning and automation
There is no strict regulation
Provides financial services
Traditional and outdated practices and procedures
Lack of speed and agility
Focused on legacy systems
More difficult to introduce new services quickly
On-site service for most procedures
Access subject to branch hours
Fighting against legacy infrastructure to be able to deliver new services and experiences
Regulated by national or central banks
The future of digital banks
Innovation in this sector is constant, so it has great potential to continue growing. In addition, the improvement of financial products and the future integration of artificial intelligence to offer more personalized services to users will benefit the growth of the digital bank.
We recommend you read our other post on the free virtual card and learn a little more about this sector.