Digitization has changed a lot of elements in almost every industry. The financial industry tops the list when it comes to adopting digital means of accomplishing banking operations. Technology has altered the ways the traditional banking structures were operating. The arrival of digital banking has revolutionized the banking sector as technology is rapidly growing. The emerging technology in banking has pushed various other elements like cardless ATMs, investment management applications, and mobile digital wallets.
Banking solutions have dramatically changed with the arrival of online banking features. There are a lot of options to deposit checks, withdraw or transfer money without having the users going to banks. With technology, all of these procedures have been revolutionized. As the whole industry is shifted to more digital solutions, cybersecurity and data protection regulations have been improved drastically. A lot of factors like ATM machines, integration of financial solutions, online banking, and 24/7 access to banking functions are a reason as to why there is a need for digital banking.
Difference Between Digital and Online Banking
Digital banking may be a new thing in the market but online and mobile banking has been practiced for a long time. The key difference between the two is that online banking enables people to check their transfers and manage their funds around the globe with the help of many options. While digital banking goes much deeper and deals with the banks’ internal systems.
Digital banking cannot be accomplished without complying with KYC laws. The regulatory authorities have designed KYC compliance rules for banks to adhere to so that the process of digital banking can be performed seamlessly. Due diligence in banking requires financial institutions to verify the identity of their customers using document verification. KYC in banking can be performed at many levels such as at the time of customer onboarding, to monitor the transactions, etc.
Benefits of Digital banking
Let me tell you there are a lot of benefits that you can acquire to bank digitally in 2021.
Many banks provide a lot of features in the digital medium. They may offer advice on managing funds, tools on saving, big purchase calculators, and even virtual assistants that can help aid the customers in deciding which offers they can afford all within the convenience of an app.
The most useful features are the ones that help the service consumers to utilize the basic daily banking transactions in an efficient way.
Security is the number 1 priority for financial institutions.
This is a fact that security threats are everywhere. No business or industry is safe when we talk about facing online scams. Fraudsters have left their mark on every business you name.
Financial institutions are no exception. To gain monetary benefits, fraudsters try their best to take full advantage of loopholes present in the banking sector. Therefore, bank officials are trying their best to KYC due diligence in digital banking to remove fraud threats.
In order to have tight security in banking operations, the institutions are practicing biometrics. Biometrics in digital banking helps in minimizing fraud threats to eradicate the fraudsters’ tricks to spoof the system.
Security reasons have demanded robust verification measures that can verify users in real-time and face recognition have all these peculiarities.
The most important and user-friendly aspect of digital banking is the convenience it is providing to customers. Who does not use mobile phones at this age? The users see it easy to perform operations on their mobile phones and computers, such as sending money online safely
But as the institutions started using customer due diligence for banks, the mindset has been changed. Now as the officials fulfill KYC compliance requirements for banks, it is easy to kick out criminals from banking operations, and thus the users’ confidence can be restored in digital banking.
Banking is the sector that has the maximum number of frauds associated with the sector. But after the development of KYC banking regulations, the sector has improved its working operations to a maximum extent. The dream of digital banking has now been realized as the KYC due diligence of customers is being practiced in the institutions. Not only for banks, but digital banking is useful for users as well.