Innovations In The World Of Consumer Banking

Consumer banking is constantly evolving. It is spurred on by new advances in technology, and provokes new advances in turn. Here is a very brief guide to some of the most important new developments in the world of consumer banking. You, the reader, will have undoubtedly made use of some of these innovations in your day-to-day life.

Personal Banking

Personal banking is not a new idea, but it is one that is being expanded upon more than ever. The term ‘personal banking’ can be used to describe any banking service that is squarely aimed at individual consumers. Banks have offered personal banking services for many years. The provision of personal banking accounts has evolved massively in the last few years. Individual consumers are now able to make investments, find perks and exchange money more easily than ever thanks to a new generation of personal banking applications. The amount of debt facilities offered as part of a personal bank account has also increased dramatically in recent years. Consumers can acquire debt through overdrafts and short-term loans through their regular bank account.

Contactless Payment

Contactless payment has completely changed the way money is exchanged at shops, in train stations and just about anywhere else where debit cards are accepted. Contactless payment has been made possible thanks to a technology known as Near Field Communications. Near Field Communications enabled cards and devices to use short-range radio waves to communicate with card readers. If you have ever visited New York City or London, you’ll have noticed that the public transportation systems in these great cities have been adapted to incorporate contactless payment. Contactless payment allows for the streamlining of many payment processes and has largely eclipsed the chip and pin system for small-scale transactions. Large transactions typically still require a consumer to insert their card into a machine.

Investment Applications

Consumers can now make small-scale investments with incredible ease thanks to the proliferation of investment applications like E Toro. These applications provide consumers with a list of stock investments and all of the accompanying data that they need in order to make a balanced decision. Far away from the chaos of the stock exchange, a consumer using an investment application can put very small amounts of money into a business and watch it grow. It should be noted that there are some critics of investment apps. The ‘gamification’ of investment thanks to these apps has been criticized due to the strong resemblance this new form of investment has to gambling. Perhaps investment has always been a form of gambling, and investment applications simply portray it honestly.

Checking Account Applications

Many people now access their checking account using a mobile application. Online banking is regularly a mobile concern. In the United States of America, many consumers have expressed their preference for using mobile banking applications when carrying out a number of tasks. The new generation of mobile checking account apps are very easy to use and relatively secure. Consumers typically set up some form of multi-factor authentication to protect their valuable information. This is, more often than not, some kind of combination of biometric and password authentication.

Checking account apps allow consumers to check balance, apply for overdraft loans, transfer money and make investments – all from the palm of a hand. The ubiquity of checking account applications may one day eclipse the need for in-person bank branches.

Online-Only Banks

In recent years, a number of online-only banks have shaken up the consumer banking scene in the USA, UK and elsewhere. These so-called ‘challenger banks’ do not have physical branches and can only be accessed via the internet. Challenger banks aim to draw in customers by offering user experiences that are more smooth and mobile friendly than those offered by traditional large banks. They also offer a number of innovative new saving and personal finance features that appeal to younger people.

Challenger banks that operate exclusively online have made a big difference to the banking landscape. They have shaken the market up enough to provoke major banks into a digital reset. Major traditional banks have now adopted some of the tactics used by online-only banks: offering good quality online banking interfaces and adaptive accounts. Challenger banks have become extremely popular in the United States of America. According to statistics collated by Statista, there were 39 million American challenger bank users in 2020. Chime is the largest online-only bank in the USA, although other companies are catching up fast.