The Benefits of Digital Banking for Small Businesses

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When operating a small business, it is paramount to have a steady cash flow, secure payments, and receipts. Also, be ensured that your sensitive data are kept safe from attacks. Digital banking for small businesses

As Digital Banking methods progress in the world of tech, they become quicker and safer than most traditional exchange methods between two parties. So what exactly are the benefits of digital banking for small businesses aside from speed?

Digital Banking Allows Small Businesses to Keep Track

Since small businesses or start-up organizations that are at the beginning of their entrepreneurial journeys can’t really afford to hire top-level accountants or pay for an advanced accounting system to monitor all the processes and finances in their firm, they can take advantage of digital banking.

Digital Banking allows smaller enterprises to manage their finances smartly. Additionally, it keeps track of everything in the form of reports, either weekly, monthly, or quarterly. These are easy to filter, which gives an extra edge to decision-makers in the company. You can always take a step back and see what you’ve paid to whom in which time period.

Some neobanking solutions for businesses can even allow you to share your financial data with a third party, like a financial analyst. As a small business, you could do that once per quarter or a couple of quarters instead of hiring a full-time analytics team.

It’s Convenient

Are you outside of the office? At the beach? No problem. You’re carrying all your financial data in your pocket on a mobile device. What’s more convenient than that? Online banking has become the leading way to handle money globally.

If you are a busy business owner, you can use the features while traveling, stuck in traffic, or even in a meeting if it allows it. Sometimes during meetings, questions regarding finances that you can’t know for sure could come up. Taking out a phone and checking in a matter of seconds is something that can help you a lot. You can have it all, employee salaries, payments, bills, and invoices, in one place, at all times.

Brick-and-Mortars Are More Expensive

Did you know that traditional brick-and-mortar banks with physical locations need to spend a ton of resources on organizing financial records and documents the usual way? They need to pay for a location, build an office, have ten times the number of employees, and interact with customers one-on-one on a daily basis. All of this requires more resources and leaves almost none for innovation. These are just some of the reasons why brick-and-mortar banks charge more for almost everything than digital banks.

On the other side, neobanks don’t rely on physical locations and invest all they’ve earned into improving the digital interface and infrastructure of their product. This makes automatic billing seem like a walk in the park.

If your employees are on a fixed salary basis, you can easily schedule all salary payments. Other expenses like bills can also be deducted automatically, and even monthly subscriptions, since you can easily get a business debit or credit card alongside your banking account.

Better Digital Security

Nobody walks up to a bank and robs it these days; it’s not the 90s. Banks are getting smarter and stopped carrying large amounts of cash in their safes. On the other hand, however, there are billions of digital dollars out there. 

As mentioned above, digital banks have way more resources to spend on innovation and security, while traditional banks have to spend money on locations and traditional real-life security personnel, who can’t really keep you safe from hackers.

New online payment platforms operate with advanced blockchain technology, which brings with it a whole new level of decentralized security. This prevents attackers from hacking one specific place or domain and gaining information. Information gets encrypted and broken down into nodes within the blockchain, becoming almost inaccessible to hackers.

Aside from high-level data encryption, digital banks also take advantage of numerous firewalls and the best and latest antivirus software. Of course, regular KYC inspections are still done for additional security, preventing social engineers from accessing your accounts.

A Smaller Environmental Footprint

Whether you are concerned about nature and the environment or not, having a smaller environmental footprint is a goal everyone should strive for. New regulations regarding certain operations are being implemented each month. Some of these impact the amount banks charge. However, not digital banks. They have an almost unnoticeable environmental footprint. Paperless operations, transactions, online support, and no office, meaning no commuting, are just some of the reasons digital banks are much better for the environment. However, a business records management plan is always needed to keep sensitive information safe and organized.

Final Words

Each year, the reasons why a small business should switch to digital banking instead of relying on brick-and-mortar banks continue to accumulate.  Digital banks lower your cost and provide better security, convenience, automatic payments, and financial tracking. The best thing of all, it’s easy to start and try without you having to visit an actual bank. All from the comfort of your home.

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Serge Beck is the CEO and Founder of Optherium Labs, a global fintech company developing blockchain solutions to reform defective functions within financial and security infrastructure. He is driven by his belief that people deserve sounder, more secure financial services in our tech-driven world and is committed to eradicating current problems detrimental to end-user experience through the creation of synergized, decentralized products.