The Age Of Digital Banking

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  • January 22, 2021
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The fast and the furious will save the day

The commerce and economies of man since time immemorial are interwoven into the world of banking. After all, where would the money and valuable assets like gems, stones, and documented loans, insurance, and other proofs of ownership go without banks? History oftentimes records that most of them have sunken in chests into the bottom of the sea or under the earth without nay a trace. That is certainly what most, if not all, do not like to happen with their hard-earned wealth and riches, especially in this age of great technology.

Many ways of lives count so much and more with what technologies can offer. From cooking to travel, from homes to industries, smart automation has become the norm. If this is the case, money and asset transfers, payments, cashflow, and storage will, likewise, have to evolve, too.

Upon entering a bank, clients are beginning to experience somewhat an upward level of banking service from a manual encounter with the teller to an automated entry of transactions on a computer standing on a corner. Clients may even avail of getting a service number from their laptops or mobile phones at home or along the way prior to a bank transaction just to skip a long trail of customers waiting in line. Truly, banking has gone a long way since the first installation of the ATM.

But it does not stop there. A new challenge has emerged with the invention of cryptocurrencies. As most banks are dealing with fiat and service upgrades from manual to automated, a new kind of money called digital currency must be dealt with, too, if banks have hopes of thriving well into the digital future,

Digital Banking Convenience

Digitalizing the many ways banks are delivering their services are means to keep customer loyalty at a high rate. As previously mentioned, even at the comfort of their homes, digital banking makes it possible for clients to transact business using their mobile phones, computers, or laptops by depositing or withdrawing, paying bills, reviewing records of financial history, or even scan banking checks directly into their accounts by a mere click of a button through an app. Digital banking makes financial management online very convenient as banking hours run 24 hours a day even on weekends, anywhere.

Digital or online banking eliminates a lot of overhead costs, the reason why they can offer low interest on loans, and high interest on savings. They are even capable of rewarding their customers with cashback and other perks.

And Inconveniences

As banks face the realities of adopting digital services, some customers who are used to conventional banking may now be reminiscing how things used to be.

There will be no more walking physically inside a bank and experience courteous welcomes and face-to-face encounters with managers and employees. online dealings and phone call conversations can be taxing especially when specific issues need to be clarified. Even more so with digital banks without physical locations for OTC exchange or ATMs. They may be limited with other banking services that an otherwise physical bank can offer. what more with threats of security and privacy that online banking services are prone to.

Now Back to Digital Currencies

Twelve years past and pretty much of the world have yet to know what digital currencies, or cryptocurrencies, for that matter, are. Because of the invention of blockchain technology, Bitcoin came into being, and soon other cryptocurrencies in hot pursuit of gaining grounds in the emerging market industry. In a nutshell, blockchain assures cryptocurrencies of being decentralized, immutable, transparent, secured, quick transactions, low fees, and without reliance on third parties. The open-sourced ledger of blockchain will make cryptocurrencies hard to counterfeit, considering other factors employed such as encrypted keys and hashing functions. These features make cryptocurrencies very attractive to most who are tired of fiat manipulations by governments and central banks. Users are drawn most especially with the anonymity that cryptocurrencies offer since personal information is strictly classified. Trading parties do not have to reveal their identities.

Digital Currencies Need Digital Banks

Now that institutional investors are heavily moving into Bitcoin, stablecoins, and other leading cryptocurrencies, it is but timely that digital banks come out to facilitate its custody, management, and transfer, buying, and selling, protected by regulation. The Crypto movement into the mainstream has definitely started and cannot be ignored anymore. The recent cryptocurrency bullruns are testaments to this.

Rather than be left behind by the tectonic shift, banks and other financial institutions in the US are piling up their applications at the  Office of the Comptroller of the Currency after it issued an interpretative letter stating that it is now allowing banks and other related institutions to custody the crypto assets of their respective customers. The letter essentially reiterated that the banks must continue to satisfy the needs of their customers with the safeguard of their assets including cryptocurrencies. The OCC also requires banks to hold reserve assets of customers who are issuing stablecoins. These regulatory certainties can haul a whole lot of cryptocurrency holders into the fold, who may find that there are not enough digital banks to serve them.

An OCC follow-up made clear that national banks are now authorized to engage in public blockchain networks and use stablecoins to conduct payment activities and other bank-permissible functions. The mandate essentially elevated public blockchain networks to that of payment giants such as SWIFT and ACH.


Crypto businesses are taking the lead in applying for bank charter applications as they are more than ready to meet the demands of the evolving market. Institutional banks have a lot to catch on. While many still rely on obsolete processes and decades-old infrastructure, no sooner will they be faced with the hard truth of speed transactions according to the speed of the Internet. Not able to cope up with this alone will leave investors no choice but to move to other institutions of the FinTech nature to be able to meet the demands of internet, online, or digital banking, whatever it is called, in the name of speed. Losing time entails risky business.

The OCC vision opened a level playing for both legacy and crypto firms. Digital banking is up now for grabs.

The fast and the furious will save the day.

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