The word Digital Banking is creating waves across the globe. In India, it is one of the most widely discussed terms subsequent to the demonetization of Rs. 500 and Rs. 1000 currency notes. Digital banking has been in existence, but still there exist confusion on the exact meaning of the term.
What exactly is digital banking?
Mobile banking and online banking are often mistaken for digital banking. They are only minor constituents of the segment. Digital banking is all about better convenience and better experience to customers. It allows customers to convert their laptop or mobile or any device of their choice to virtual bank branch. It empowers them to carry out all their banking transactions on their own, from anywhere, anytime. The bank ensures compliance of rules and regulations of the land and safety of transactions, but the operating power is handed over to the customers. Thus banks ensure effective, efficient and enhanced customer experience.
At present, digital products targets high net worth and influential customers for who time means money. In fact, it is in an evolving stage. The explosion in mobile banking is just a tip of things to happen.
Why the focus on digital banking?
Banks and financial institutions focus on the new option to meet various objectives like:
• Customer engagement
• Retain the winning edge in a highly competitive market
• Attract more customers in a cost effective manner
• Better cross selling and upselling opportunities
• Reduction of operating cost
• Better convenience and overall experience to customers
• Error free accounting
• Track the customer behavior
What are the impacts of Digital Banking?
Digital will reshape the fundamental structure of banks and financial institutions. In true sense, the brick and mortar type of banking will become redundant. When the physical structure undergoes changes, banks will be able to save on operating expenses. The various fees and charges will come down drastically and the end beneficiaries will be customers.
Why digital banking beneficial for organizations ?
The digital transformation offers critical evolution of new capabilities and competitiveness to organizations. Digital banking and digital capabilities allow organizations to integrate accounting, banking, operations and penetrate untapped segments in a better and cost effective manner.