2021 Has Increased The Adoption Of Digital Banking: Here's Why The development Is Here To Stay

As 2021 comes to a close, a lot of us would still still remember this because the year when COVID-19 put a standstill to global travel, forced many office workers to work-from-home and required us to abide by strict social distancing measures for example only being able to gather in small groups.

What might be less remembered may be the pivotal role COVID-19 has played to accelerate digital trends in lots of parts of our lives.

Due to Circuit Breaker in Singapore, along with other lockdown measures that have been introduced globally, a lot of us needed to adopt new ways of doing items to continue our daily lives be it working-from-home, buying groceries, ordering food, attending university lectures or even finding methods to continue leisure activities.

Going Digital Was Always The Obvious Solution

With deep internet penetration in Singapore, going digital had become the obvious solution for many businesses. Interactive video apps such as Microsoft Teams and Zoom quickly gained tens of millions of users as businesses pressed to carry on operations and maintain internal communications.

Businesses also raced to set-up their e-commerce capabilities. At a consumer level, individuals are looking for these e-commerce set-ups to carry on their required and discretionary purchases.

To be clear, it isn't these digital solutions didn't already appear in the past.

The problem lies in the invisible barrier to alter. Often, barriers exist because individuals are reluctant to alter the way they are utilised to doing things. For example, a company which is used to holding physical meetings may prefer to continue meeting in person as far as possible. A provision store might not prioritise an e-commerce set-up until it's instructed to achieve this. Even if you are looking at banking-related matters, some individuals might not think that they require internet and mobile banking until they face some form of inconvenience.

Because of COVID-19, some of these barriers were simultaneously broken. This was the same for banks and banking institutions, which had to embrace digital solutions to prepare themselves for the following stage of the digital revolution.

Rising Digital Adoption Of Digital Banking

Once everything moved online, and because people also became more mindful of handling physical notes and coins, paying gone to live in cashless options. This saw large swathes of companies race to set-up their e-commerce capabilities and also to accept in-store digital payment as people also shift a larger share of the payments on digital platforms.

Today, there are lots of mobile payment apps and services, for example Google Pay, Apple Pay and Samsung Pay that people can link to our charge cards, allowing us not only to pay without cash, but also without needing to use our physical cards.

Once the economy recovers and health fears have subsided, these trends are not only going to disappear. Instead, they are not going anywhere soon.

Hooked On Digital Banking Services

During the Circuit Breaker, and at the height from the COVID-19 fears in Singapore, some banks and other financial services needed to close their bank branches for a period of time. Along with our preference and also the government's encouragement to avoid social interactions so far as possible, this meant an outburst in demand for digital banking and financial services.

Utilising digital solutions generally mean more convenience, having the ability to perform transactions faster and on-demand, as well as a seamless solution designed specifically for people to complete their own transactions.

At the same time frame, nearly all banks in Singapore have a comprehensive mobile app for customers to stay up to date with their accounts and to manage their personal finances.

For example, the SC Mobile Singapore app, easily downloadable via Play Store or Apple Store, allows us to make transactions virtually, much like what we should can do when we walk in to a physical bank branch.

In addition, via its SC Money Manager tool, the app can provide us analytics into our expenditure habits and income – telling us just how much we spend every month and on which product categories. Additionally, it provides for us the option to create a financial budget for categories such as shopping, dining, transport, entertainment yet others, so we get alerts when we save money than we've initially budgeted to spend. This prevents us accountable to a budget.

Whether it's with the SC Mobile Singapore or any other popular bank apps for example DBS digibank SG, OCBC Bank or UOB Singapore that lots of us can also be using, features for example being able to make fund gets in our friends, bill payments to organisations or to review our e-statements are available via the apps. We may likewise be able to apply and obtain approval for any digital credit card instantly, while not having to wait for the card to arrive before making a transaction.

Some apps such as the Standard Chartered Mobile Trading app, downloadable on the Play Store and Apple Store, also allow us to trade in the financial markets through our mobile phone.

More Competition (And Innovation) From Existing And New Digital Banking Players

COVID-19 or not, Singapore has been poised introducing up to two digital full bank licences and three digital wholesale bank licenses. In December 2021, the Monetary Authority of Singapore (MAS) announced the awarding of four digital bank licenses to companies. These are banks that might be providing banking services on digital platforms.

Interestingly, none of the four winners – Grab & Singtel; Sea Limited; a consortium comprising Greenland Financial Holdings, Linklogis Hong Kong, and Beijing Co-operative Equity Investment Fund Management and Ant Group – are firms that we would consider as financial institutions. So all these new players would bring their own unique approach towards digital banking.

As competition gets hotter, consumers will likely stand to profit from more disruption in the space. This may be by means of existing and new players introducing more innovative solutions and analytics tools, better service, lower costs and much more. In turn, this can only actually accelerate the higher adoption of digital banking tools.