What new services do digital banks have compared to traditional banks? 

Digital banks have no physical branches in the high street that you can call into and have a face to face discussion. All of the banking activity is managed entirely online and through app-based platforms that you can view on a mobile or tablet. This offers several benefits that traditional banks are unable to offer.

Transparency and real-time processing

Digital banks are able to offer a greater level of transparency to your banking, allowing you to see in real-time as your spending transactions and receipts take place. This allows you to monitor your transactions carefully. Many digital banks have special facilities to enable you to set up saving pots, allocating part of your budget each month to specific categories so you can put money aside for a variety of purposes.

Some of the newer ‘challenger’ digital banks offer bill-splitting functions, ideal for when you’re out for a meal with friends or business acquaintances or for the sharing of other bills. They can provide 24/7 support, helping to ensure your business current accounts or personal bank accounts are easily managed. The support is often achieved through online chat arrangements rather than telephone support. You can instantly freeze or unfreeze your cards if your card is lost or stolen or your expenditure needs to be put on hold until a certain point.

Services and offers 

Digital banks vary concerning the services that they offer. Still, there are often facilities to be able to order spending and saving reports, together with the removal of additional charges for spending abroad. Some even partner with other complementary services, sharing your details and allowing you to shop around for the best insurance offers or utility provider, for example.


Digital banks use the latest technology to keep your account secure, using face, voice or fingerprint recognition (or a combination of these) and most have a thorough sign-up process that involves setting up two methods of authentication. The instant notification of monies spent or received and the ability to freeze or unfreeze cards, together with the 24/7 chat functions mean that you can act on any suspicious-looking activity straight away and prevent any further access to your account. 

Some allow you to change the PIN online so that if your card is lost, you can prevent it being used or you can change your PIN regularly for added security. Some use biometric security measures; for example, you may need to send in a short video of yourself for identification purposes.

Simple account creation

Many digital banks offer the ability to open an account for free from your phone within a few minutes, without having to wait for lengthy processing procedures to get the account up and running and obviating the need for complex levels of identification from third parties.


A significant percentage of digital banks offer you the ability to generate reports and analyses so that you can look at your spending habits or work out a savings schedule to help you reach a target. Some offer colour coding functions so that you can see how much you spend in different categories.

Cost and convenience

Since digital banks don’t have the overheads of having to run physical high street branches, they can operate in a fairly frugal fashion. They can offer lower interest rates on loans and lower account fees, together with reduced charges if you need copies of physical documents that your bank might hold. Also, there are hidden savings in terms of time and transport costs since you will never need to visit the bank to carry out your financial transactions.

Customer service

Digital banks use the latest technology to manage relationships with their customers and are highly focused on the customer experience. They can be far more fluid in adapting their services and technology to changes in the marketplace. These digital banks can align themselves with other services to deliver the best customer experience together, rather than being tied by the old school style hierarchies that tend to constrain traditional banks.

If you are planning on opening a digital bank account, you should consider whether you want this to be your only bank or if you wish to use it in conjunction with a traditional bank account. There may be some transactions that you prefer to carry out in person face to face in a traditional high street branch. 

As digital banking is such as a new sector, it offers exciting new opportunities. The range of services and benefits are sure to improve as the challenger banks become more established rapidly.

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