Rory Brown Managing Partner Nicklaus Brown E Commerce Virtual Banking

Rory Brown, Managing Partner of Nicklaus Brown & Co., on How E-Commerce Impacts Virtual Banking

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The world of e-commerce has grown in ways that our financial institutions could not have completely predicted. E-commerce is creating demands for ever-increasing levels of fintech development and virtual banking.

Virtual banks are financial institutions that maintain their entire presence online and handle all transactions over the internet and through ATMs. In this article, virtual banking expert Rory Brown takes a look at how the online banking sector has been and continues to be impacted by e-commerce.

Third-Party Payment Processors

As businesses expanded the markets based on the power of the internet,  businesses and consumers needed a safe and efficient way to make payments. For example, PayPal developed a way to process payments through an encrypted platform for handling payments. PayPal and similar platforms provide a secure way for purchasers to make payments without disclosing their credit card or other sensitive information.

Virtual Banks

Historically, banks could not function without a system of physical branches. As e-commerce developed, people began to place a higher priority on the value of online bank accounts, money transfers, and bill payment above the need for a physical bank location. As retailers around the world expand their capacity to accept payments through apps and third-party processors, the ease of transferring money between virtual bank accounts and payment platforms will drive the further growth of virtual banking services.

Online Lenders

Lenders are finding that modern consumers are less likely to consider a physical office as essential to obtaining loans. The lack of a viable online presence hampers the ability of traditional lenders to compete. Increasing numbers of companies provide an entirely online application process for personal and business loans as well as home mortgages and refinances.

Investing and Trading

Individual investors are moving more to an entirely online investing experience. Online investment firms and brokers are able to provide virtually instantaneous investment and trading information to individuals with reduced rates and fees. Online investing and trading tools allow individuals to customize their investments based on current information and analysis. Many, if not most, investors place great value on instant and continuous feedback regarding their investments, as well as the ability to complete trades, purchases, and transfers in real-time.

As the fintech-based industries continue to expand and refine the financial services that are safely and efficiently processed online, companies of all types and sizes will continue to adopt virtual banking and transactional developments.

About Rory Brown

Mr. Rory Brown has focused on financial technology and investment management for 30+ years. Rory Brown Co-Founded one of the world’s first Internet Banks and writes extensively about the industry.

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