Digital vs Traditional

Banks
Group - 2

20P057 Shubham Kumar

20P082 Gaurav Jain
20P093 Nikhil Agarwal
20P094 Siddharth Bokaria
20P096 Parth Goswami
20P190 Anto Thomas
 Table of contents

01 Introduction to 02 Traditional Banking

Banking Services

03 Digital Banking 04 Major

Services Differences

05 Influence of Technology 06 Transformation of

in Banking Banking

07 Future of Banking
01
Introduction to Banking
Introduction to Banking
Banking is defined as the business activity of accepting
and safeguarding money owned by other individuals and
entities, and then lending out this money in order to
conduct economic activities such as making profit or
simply covering operating expenses.

Or, in a broader sense, a bank is:

Any financial institution that receives, collects, transfers,

pays, exchanges, lends, invests, or safeguards money for
its customers.

Banking can be done in the following manner:

● Traditional Banking (Offline)
● Digital Banking (Online)
02
Traditional Banking
Services
Traditional Banking Services
A traditional bank has a headquarters, as well as regional HQs,
with branches located across the countries in which it operates.
Many traditional banks operate their own branded ATMs.
Smaller traditional banks may join together to operate a large
number to share costs. Traditional banks, with their local
branches, were initially chosen for their convenience as well as
their face-to-face customer service. Main Services being
offered
● are:-
Open an Account
● Open or create fixed deposits
● Renew fixed deposits
● Inquire about Tax deduction
● Inquire about cheque status
● Request for a cheque book, DD.
● Stop payment of cheque
● Apply for different types of loans like, Auto,Mortgage,
Home, equity, Personal etc.
● Receive investment product and service information
● Order traveler, cashier and regular cheques
● Fund Transfers
03
Digital Banking Services
Digital Banking Services
Digital Banking is the automation of traditional banking
services. Digital banking enables a bank’s customers to
access banking products and services via an
electronic/online platform. Digital banking means to
digitize all of the banking operations and substitute the
bank’s physical presence with an everlasting online
presence, eliminating a consumer’s need to visit a branch.

Services:
● Obtain bank statements
● Fund transfer by NEFT, RTGS and IMPS
● Mobile banking
● Cah withdrawals
● Bill payments
● Investing, raising loans, opening FDs etc.
● Managing cheques
● Monitoring transaction records
04
Major differences
between Traditional
and Digital Banking
Major differences between Traditional and Digital
Banking
Features Traditional Model Digital Model

Limited. Service is provided only Unlimited. Possibility of round

Customer Service Time Frame
during clearly defined hours the clock access

Speed of Customer Service Depends on the bank employee Immediate

Flexible, however, it is limited to Flexible and carried out through

Approach to Service a small variety of service channels based on the client's
channels convenience

High, accounting for bank

Low, often these services are
Maintenance Cost personnel and maintenance of
provided free of charges
different departments

Unlimited, can go beyond

Limited to branch network and
Scope of Service geographical location of the
staff’s personal network
banking institution
Major differences between Traditional and Digital
Banking (Contd.)
Features Traditional Model Digital Model

The functions of the operator is The functions of the operator is

Status of the operator during
performed by an employee of the performed by the bank’s client
the service process
bank (customer)

Procedure of informing about

Quickly done via SMS,
new services, products & Requires time and cost
Newsletters, App & E-mails
promotions

Consumable component of the Majorly dependent on articles for

Majorly dependent on the staff
operation of the service purchase, maintenance of
and maintenance of departments
system servers and software packages

Source: Galazova, S.S., and Magomaeva, L.R. (2019) The Transformation of Traditional Banking Activity in Digital, International Journal of Economics and Business Administration, Volume
VII, Special Issue 2
05
Influence of Technology
in Banking
Influence of Technology in Banking

● New Experience - Customers/users have been swayed by the

ease of use, one stop solution and 24*7 services. Banks will
have to content with two kinds of customers, physical and
digital to which the same services must be offered and pay the
same attention
● Fintech - Provides niche technology with the niche service
catering to the customers. Banks sees them as an opportunity
to learn and improve their processes
● Operating Model - Engagement through physical stores and
having a net banking app/website is levelled up by additional
facilities like safe deposits, credit card, RD etc.
● Automation - Improving efficiencies by removing manual and
repetitive processes and seeking to reduce costs to increase
profit margins
06
Transformation of
Banking Sector with
Inclusion of Fintech
Transformation of Banking Sector with Inclusion of
Fintech

Source: Galazova, S.S., and Magomaeva, L.R. (2019) The Transformation of Traditional Banking Activity in
Digital, International Journal of Economics and Business Administration, Volume VII, Special Issue 2
07
Future of Banking
Future of Banking
Banks and Fintech would collaborate,leading to these fruitful results:

Safe and Secured Transactions Joint Investment Products and services

The partnership will result in:
● Cutting-edge technology
of Fintech
● Transaction
Authentication
This would ensure safety and
security in all transactions
Joint Investment in:
● Technology
● Innovation
● Accelerator programs
This would target different
areas of banking for their
mutual growth
The partnership will lead to
them providing a wide range of
products and services to attract
new customers and allow banks
to face the cut-throat
competition in the market.

Transacting at ease
Discounts and offers
The bank consumer’s transact using the latest
Due to low operating costs and high
technology and save on transaction time,
transaction volumes, banks in partnership
efforts, and money.
with fintechs will be in a position to
Banks and fintechs will also benefit in terms
provide their consumers with a variety of
of high transaction volumes with a low
offers that can attract new customers and
operating cost within a short duration of
retain the existing customer base.
time.
 Future of Banking
Banks and Fintech would collaborate,leading to these fruitful results:
Regulatory support and
Venture in new alternate government incentives
businesses Countries are supporting and
Strengthened confidence in relaxing the regulations to
merchants operating in a variety promote technology in banking
of businesses: and financial markets.
● Connected to reap the Both banks and fintechs can
benefits of collaborative leverage this support and
business, relaxation by collaborating with
● Less business channels each other to their mutual
● Lower costs associated advantage.
with them
● Hence, customers pay less
Rate of return
The rate of return on investment
will mostly be higher, in the long
run, considering high volumes and a
low operating cost.
Change acceptance
Banks and fintechs partnership
would mean acceptance of
constant changes in the financial
markets with respect to
investments, products/ services,
competition, technology, and so
on.
Consumers' expectations will be
met upon the implementation of
such changes at regular time
intervals.
Thank you!