The evolution of banking: the rise and rise of digital banks
Within our increasingly digitalised world, banks and banking systems have continuously needed to evolve and adapt or risk being left behind. Indeed, over the last seventy years alone, advancements in technologies have coincided with and changed the way you and I interact with our bank forever.
In a global economy driven by digitalisation, one thing is clear, people want greater control and transparency over their finances and grow ever more frustrated by outdated banking methods such as overpriced and ridiculous international transaction fees.
The onset of ATMs in the 1960s brought into realisation the concept of out-of-hours cash distribution and greater convenience for all. No longer did working people have to schedule their time around banking hours to withdraw money or check their finances. Early forms of credit cards in the second half of the 20th century also meant that people did not need to carry large sums of cash with them in order to make payments.
Furthermore, the creation of the World Wide Web over two decades ago once again revolutionised the banking industry. Internet banking services and online shopping meant that people could check their finances, deposit money, make transactions and purchases all from the comfort of their own home. Into the 21st century and the birth and widespread use of the smartphone (featuring a multi-touch surface) prompted banking services to once again change their style.
Keeping this in mind, it stands to reason that the next phase and logical process in this evolution is digital banks and or banking led primarily by mobile apps.
A lack of transparency and hidden fees means that many physical banks are systematically and routinely offering bad deals for international transfers.
Step in digital banking. On a basic level, most successful banks understand the importance of going digital in today’s world. However, what I am referring to here are banks where no physical outlet is needed.
In fact, virtual banks are fast proving to be the cheapest and most efficient way to transfer, spend and exchange money abroad. A virtual wallet that can be carried by you and used anywhere in the world with none of the hassle.
Digital banks allow the user to instantly transfer money with zero hidden fees whilst also giving you a clear view of the best and real-time exchange rates.
These global money apps allow you to exchange and store several different currencies within the same account. They allow you to exchange and spend money at the best available rates. Many of these virtual banks also offer multi-currency credit cards that can be used almost anywhere in the world. With each transaction made, the card looks at your available balance and converts it to the local currency automatically at the best available rate.
Virtual banks give the consumer more control over their finances than ever before all with the touch of a button. These banks are not simply an added feature to traditional banking methods. They are within a breed of their own
As far as timeframe goes, these virtual banks are still relatively in their infancy but within a digital age that shows no sign of slowing down, these methods of banking are the future.