The concept of"digital bank" is relatively new to Malaysians. But many have become aware of it, especially with the introduction of two digital bank operators that have already started their services for the public, namely GXBank and AEON Bank. The third one is Boost Bank, which debuted recently.
In contrast, digital banks allow you to do everything over the Internet. You no longer need to physically go to a bank because everything can be done on your device. You can also set your transaction limits, withdrawal limits, and permissions for online transactions using the digital bank's app.What are the benefits of digital banking? The main advantage of digital banks is convenience because all banking tasks only require you to log in to the digital bank application.
In 2022, BNM reported that out of 29 parties that applied for a digital banking license, only five applicants met the criteria and successfully obtained the license. As of the posting of this article, the number has not changed.Additionally, every digital bank account owner will receive the protection of Perbadanan Insurans Deposit Malaysia for up to RM250000.
Another possible disadvantage is customer service. When you want to perform a relatively complicated banking task, such as password retrieval, you have to rely on a chatbot or contact a customer service officer by phone or text. This is different from conventional banks, where you can meet a bank officer in a physical branch and get advice that is clearer and best suited to your financial status.An individual's grasp of technology could also scare people away from digital banks.
The third one is Boost Bank, which launched on 6 June 2024. Boost Bank is the first digital bank produced in collaboration with a conventional bank and owned by a local company. It offers 0.5% pa for deposits below RM2000 and 2.5% pa for deposits above RM2000, as well as a 'Jar' savings service for higher rates of return. If you're trying to save more, this could be the better option.The other two BNM digital banking licensees have yet to begin operations.