When demonetisation happened, we saw several advantages of online-first banking. Standing in those ATM lines for hours just suddenly felt redundant. Then we found ourselves amid a pandemic, where we kept our distance from other people. It’s no wonder that virtual banking in India has grown in popularity in recent times. The need to go cash-free and be able to bank remotely is higher than ever before. Just like everything else we do, we also prefer our banking to be remote, from a smartphone or on our laptops.
Since we’re now living in the digital era, banking and other financial services have also taken leaps in these times. While there are a tonne of differences between traditional and new-age banking, let's have a look at the advantages of new-age banking. Here are the top 10 most prominent advantages of a virtual savings account in India.
Traditionally, banks would require you to visit one of their branches, wait in line, fill out some paperwork, print out copies of your identity and address proofs, and then finally, you would be able to sign up for a bank account. New-age banking has simplified this process. Now, signing up can just take a couple of minutes and can be done from any location. All you have to do is enter your details, upload scanned copies of your ID and address proof, and verify your account. Signing up for a bank account has never been this easy. Here's a step-by-step guide on how you can make an online bank account.
People with traditional bank accounts and no online banking presence have to go to the bank's physical location to process their requests. This process can be time-consuming and tiring. Compared to this, opening a new-age, fully virtual account is way more convenient. Their features can be accessed remotely from anywhere in the world at the click of a button. When compared to traditional banking, this new-age way of banking is also way faster at processing requests.
Since a lot of processes are automated with the help of virtual banking, a lot of these services can result in reducing certain banking fees like transaction fees and maintenance fees. This can result in customers getting higher interest rates for their accounts. However, not all online banking services offer higher interest rates and slashed fees. Fi offers zero balance savings account with an interest rate of 2.65%
If demonetisation and the Covid- 19 pandemic are any indications, going cash-free is more in demand than ever before. Thankfully, opening up a virtual account solves this problem. Several online-first features like UPIs, mobile wallets, and internet banking solutions allow users to make payments cash-free. This form of banking may also save a substantial amount of paper, making it better for the environment.
Traditional banks only operate for a certain period. These banks have allotted different time slots to visit the bank based on the day. They are also closed during bank holidays. Owing to these short visiting time intervals, account holders might find it difficult to take time out of their schedule to visit these banks. This is where opening up a virtual savings account has all but done away with this problem entirely. Automated banking features through apps mean they can be accessed 24 x 7.
Unlike typical banks' cookie-cutter features, an online-first experience may offer features like bill payment reminders, personalised budgets, money management, big purchase savings, and so on.
Before the digital era, you would have to pay your utility bills manually. With a virtual account, bill payments are easier than ever before. You can choose to set reminders for your bill payments and clear them in just a few seconds through your mobile banking app. Alternatively, you could also automate these bill payments through the app, so money is automatically deducted and sent towards clearing these bills.
A virtual account also offers rewards for using their services. These could be one-time rewards or in the form of a point system wherein you can redeem rewards of your choice through points. These rewards include things like points on transactions, discount codes for E-Commerce websites, and others.
As the Indian banking system moves more towards becoming fully virtual, it could positively affect the economy as it tends to be difficult to use black money digitally. This online-first approach may also be a positive step toward curbing the use of black and counterfeit money.
Perhaps one of the most crucial advantages of virtual accounts in India is it allows people in remote locations to access banking services. While these people might not have access to a bank in their locality, they can start a bank account and enjoy its privileges as long as they have a mobile phone. It has also been a positive step towards inclusivity when it comes to the underbanked.
While a virtual savings account in India still has several hurdles it must overcome, it has come a long way. The future of online-first banking definitely has everyone on the edge of their seats. Opening a savings account, creating FDs, starting an SIP, and many other things can now be done on your mobile which at one time required you to fill out endless forms. India with a strong virtual banking presence in the near future seems inevitable.