The BrightFit logo and the Sterling National Bank logo on a plum-colored background

Businesses of all types and sizes want more digital banking options because of the unmatched simplicity and convenience. Banks can't afford to ignore the aggressive demand for digital banking solutions or the unprecedented benefits on the bottom line. The writing on the wall is clear: current technology trends have rendered legacy banking systems unfashionable and outdated, while digital banking provides compelling proof that you mean business.

Banks willing to move with the times can use this guide to get started. It explains how to offer digital banking for business accounts and builds a framework understanding of the core concepts, benefits, challenges, and strategies associated with commercial digital banking.

Core concepts of digital banking for business

Banks and financial institutions should understand the core concepts of digital banking for business. Knowing the key drivers of digital banking ensures foundational success by allowing you to keep up with your business clients' changing behaviors and expectations.

For starters, these are the baseline features needed for the digital transformation of banks.

Cloud Technology/Architecture

Investing in cloud technology and virtualized infrastructure improves your digital banking solutions' accessibility, security, and flexibility. When you move your core banking systems to the cloud, you can enjoy greater agility and scalability. You also benefit from an upswing in operational performance and cost savings, particularly if you partner with the right cloud core provider.

Smooth UI/UX Design

Businesses are looking for a smooth and streamlined banking experience, so banks should put customer experience at the center of design initiatives. Your digital banking services should be supported by a glitch-free, frictionless, and highly responsive fintech design. Keep it simple and user-friendly.

Data-Centric Systems

The transformation to digital commercial banking should involve data collection and analysis for insight-driven strategies. Banks already process mountains of data daily and investing in a robust customer information management system helps decode the target market's behaviors and preferences in real-time. That way, you can sharpen your strategy and concentrate resources on creating an exceptional differentiator.

Application Programming Interface (API)

APIs should be part and parcel of any bank's IT stack. APIs enable different platforms, applications, and systems to integrate seamlessly, making it easier to provide streamlined services. By adopting open banking APIs, banks can accelerate digital transformation, deliver value-added products and services, and benefit from innovative solutions that enhance specific banking services.

What digital products can banks offer to businesses?

These are some of the digital commercial banking products and innovations that can help you redefine your proposition to business clients:

  • Virtual cards – They provide more convenience and better security for online business transactions.
  • Self-service solutions – Businesses can skip branch visits and use smart devices to perform tasks like self-registration and remote account opening.
  • Automated interactions – Using AI to power chats facilitates 24/7 customer support and makes a difference in your consumers' experience.
  • Instant payments – The business world is fast-paced, and instant payments help improve cash flow and money operations.
  • Microservices – This enables businesses to access a wide range of independent services that still work together seamlessly.

How do digital platforms work with existing cores?

If you're looking to keep your existing core intact, it's still possible to implement new digital banking services. For instance, you can focus on the use of dedicated microservices outside core banking.

This allows the gradual elimination of monolithic architecture and reduces the need to customize the core. The coexistence model will enable banks to decompose obsolete banking models and move towards digital transformation at a customized pace.

What are the best practices in digital banking?

It's essential to familiarize yourself with digital banking best practices. Generally, these include the following:

  • Adopt a user-centered approach and provide personalized experiences from the get-go.
  • Spoil your business clients with multi-channel banking options, so they have more ways of interacting with you.
  • Enlist the help of data analytics experts to understand customer needs better.
  • The back-end processing platform is just as important as the front-end banking platform, so give it the attention it deserves.
  • You don't have to waste resources reinventing the wheel when you can purchase available solutions on the market. Find the right partners that fits your needs for more efficient digital innovation.

Banks participating in BrightFi's "Whiteboarding with Experts" panel at ICBA LEAD FWD Summit 2022 reported investing more effort into implementing new technology and partnering with third party providers than they initially expected.

How does digital banking make life easier for banks?

When done right, digital banking can be a game-changer for banks and financial institutions. The benefits can be summarized as follows.

  • Cost savings - Green banking products like paperless billing and sustainable payment cards pave the way for higher bank ESG ratings, which translates to a lower cost of operation and increased ROI overall. Additionally, better AI functionality eliminates time-consuming manual work. It frees up vital resources that are better spent elsewhere.
  • Frictionless lending -  Banks can make fully digitized lending offers with reduced loan underwriting and approval processes through efficient, convenient, and secure services.
  • Remote deposit capture - Remote instant deposit allows banks to boost internal inefficiencies and promotes sustainability because customers can make electronic deposits without sending paper checks.
  • Data collection and analysis - Banks thrive on customer engagement. Automated digital banking makes data analytics easier, and the insights are valuable for optimizing customer experiences.
  • Payments - Enabling faster business payments is a critical differentiator that sharpens the competitive edge.

Digital services also offer many advantages in banking for businesses, especially if accompanied by 24/7 accessibility and convenience. A new digital platform that allows customers to perform self-service jobs like opening accounts, downloading eStatements, paying bills, transferring funds, and updating business information drives customer engagement and true loyalty. 

What are the challenges associated with digital banking?

There's no denying that digital transformation for banks has many benefits. That said, banks also need to be aware of the challenges.

  • Cybersecurity issues - Besides ensuring security compliance, banks also have to mitigate cybersecurity threats to digital banking. Unauthorized access to the sensitive data stored in their systems can be catastrophic.
  • Limited customer interactions - Customers can quickly become dissatisfied if the bank's digital banking platform comes with low quality and less frequent personal interaction. It can be tricky to intersect self-service banking technology with a high-touch experience.
  • Due diligence risks - The most significant risk for banks is overlooking a key part of the due diligence process when choosing a partner. This can lead to incompatibility or technology that doesn't integrate seamlessly with the existing core.

In addition, digital banking isn't always mutually beneficial for banks and customers. For instance, implementing services like remote account opening is easier for the customer but can be difficult for banks.

Fortunately, there are ways to neutralize some of the challenges. Banks are encouraged to research and strategize thoroughly, utilize a customer-centric model, and develop a robust cybersecurity plan. More importantly, banks should look for a secure and easy-to-deploy platform that can run parallel with existing cores.

How to offer digital banking for business

Once you find a full-service partner that meets your needs, figuring out how to offer digital banking for business becomes infinitely easier. For instance, BrightFi provides several options for going digital.

  • Replace your old core - You can make a big bang by replacing your legacy core banking system with more modern and open architecture at a fraction of the time and cost.
  • Unbundle your core - If you're not ready for a complete overhaul, you can still change key components of your core while leaving some existing systems in place.
  • Keep your core – add something new. If replacing or unbundling your core is not an immediate option, you can still tap into digital transformation by launching a new digital offering alongside your existing core. Sidecar Core is an example of implementation that integrates with your existing technology.

Having these options means your digital transformation can be an incredibly flexible experience, no matter where you are on your journey.

Implement digital banking today with BrightFi

As a leading fintech innovator, BrightFi can simplify your bank's digital transformation, so you can start offering digital banking for business in weeks, not months. Partnering with us boosts agility, scalability, and multi-functionality. You already have the advantage of providing personalized and engaging customer experiences. So why not complete the picture by offering high-tech digital banking solutions?

We can't wait to meet you!

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