Digital banks offer several key benefits to their users. Although these may differ from bank-to-bank, all-digital banks generally agree on providing their customers with more convenience, transparency, and insight into their finances.
The convenience of digital banking begins with the sign-up, which usually starts with downloading an app. Unlike the traditional bank application process, users can apply for a digital bank account within minutes and get approved within minutes too. This does not make the banks any less secure, as the quick sign-up involves sophisticated automated identity authentication processes. This sign-up process is also more accessible to many applicants that historically have found it harder to get accepted at traditional banks.
In Brazil alone, banks earned around R$30-35 billion from charging customers account fees in 2018. Brazilians are paying a lot in account fees and other hidden fees applied by their bank, and digital banks are setting out to offer a more honest and transparent service. Many digital banks claim to be “fee-free” or have “no hidden fees,” which in some cases also applies to international transactions. Digital banks offering no fees on international transactions and ATM withdrawals abroad are especially appealing to frequent travelers, as bank fees are known to rack up while abroad.
A huge benefit of digital banks is the money management tools they offer. Each digital bank offers its own ways to help customers manage their personal finances, but users can expect monthly reports, real-time spending notifications, spending categorization, and more. These features are designed to help customers stay on top of their finances, even letting them know how much they can afford to spend and save.