As the Monetary Authority of Singapore approves more digital banks, traditional banks are starting to improve their offer to get a fair market share in the digital banking space.
For instance, account opening for digital bank trust can be done entirely online. It is part of the five digital-only banks that began operating in Singapore over the past year.
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“The whole argument for digital banks is that they have zero physical footprint,” stated Zennon Kapron, founder and director of consultancy Kapronasia.
To encourage more Singaporeans to open an account, digital banks have been offering higher interest rates and have positioned themselves as “fuss-free” compared to traditional banks. Beyond this, they have also offered credit and supplementary cards, personal accident and travel insurance, and even a budgeting tool. Another digital bank, GSX, just added personal loans in April.
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Meanwhile, MariBank is “taking a deliberate and measured approach” to rolling out services. Trust also functions like traditional lenders thanks to its full bank licence.
“This gives Trust an advantage, as it has managed to roll out its services to the general public faster,” shared Associate Professor Jan Ondrus from the ESSEC Business School Asia-Pacific.
Despite all the benefits gained by digital banks, they need to push more to attract new customers, such as reducing their fees and improving the customer experience. After this, they must work hard to keep the customers active.
Digital banks are seeing strong interest from customers and are planning to expand their offerings. For instance, Trust is planning to launch its first loan product soon, and GSX is also rolling out more products in the future.
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