What Are Digital Banking Platforms?

June 18, 2021

Digital banking vs digital banking platforms—the difference explained plus their features and how they work.

Today, fintech firms and digital banks have become major disruptors of banking services and have transformed traditional banking and payments methods of old. But what exactly lies behind the scenes, what are the main functionalities, and what to expect next from digital banking platforms?

What are digital banking platforms?

Digital banking platforms are financial services provided solely online—as opposed to online banking which refers to specific online banking components that also have brick-and-mortar operations (known as traditional banking). Digital banking platforms rely on process automation, web-based services, and APIs to create fully digital banking services.

Many digital banking platforms encourage cross-institutional services by connecting their services with other financial providers to offer customers complete digital banking services—for example, by adding a third-party debit card to a digital bank’s products list. However, at the core of digital banking platforms are the customers and the user experience. Striving for convenience in a fast-paced world, digital banking platforms enable customers to potentially manage all of their finances from their smartphone and other online channels including payments, investments, spending analytics, and more. 

Some of the features and capabilities digital banking platforms offer customers and businesses include:

  • Checking and savings accounts
  • Competitive interest rates compared with traditional banking
  • Mobile apps
  • Financial management tools
  • Real-time transaction alerts
  • Digital wallets
  • Virtual cards and cardless payments
  • Person-to-person payments
  • Remote deposits
  • Deposit insurance
  • Free ATM transactions with participating branches
  • Competitive FX rates or even zero rates
  • Fully compliance with regulators and deposit insurance 

Digital banking platforms focus on modular infrastructure

The way people and businesses manage their money is changing. Digital banking platforms are designed to be highly adaptive to accommodate changing customer needs and to futureproof banking services against what comes next. By using modular services, digital banking platforms can customise the offerings and add new functionalities faster and more easily compared to legacy banking systems. This is made possible by creating banking solutions independent of each other and in a way that supports adaptability to ongoing changes. This cuts down on back-office resources and the cost of development, as well as enabling digital banking platform providers to stay up-to-date with the latest user trends.

Adding digital assets to digital banking platforms

Some digital banking providers are now integrating digital asset solutions into their services. Integrating digital asset services with other fiat services—such as payments, wallets, and transfers—offers end-users even more flexibility and options for spending and managing their money. Indeed, some investors, fintechs, and venture capital funds are beginning to make a sustained commitment to cryptocurrency, regarding it as the future of money. With their fully digital services and modular approach, digital banking platforms can quickly adapt and add new and upcoming services (such as digital assets) to their architecture—especially compared with the adaptability and rate of adoption among traditional banks.

Learn how adding a digital banking service to your business—such as virtual debit cards and IBANs, or an all-in-one white-label mobile app—can build value and accelerate your business plans.

Contact us to learn more and request a demo.