Why Businesses No Longer Need Bank Accounts

December 15, 2020

It used to be the case that every business needed a bank account to access vital financial services. For a long time, banks have been the go-to establishment for managing everyday business tasks, such as receiving payments, settling supplier invoices, processing employee payroll, issuing corporate debit/credit cards and accessing financing. In Europe, the ideology that every business needs a bank account is fading. There is a new wave of cost-effective and accessible digital banking alternatives, and they are skyrocketing.

Banks themselves have partially fueled the phenomenon of business moving away from traditional banking. By de-risking and sunning entire industries like forex, gaming, betting and crypto, these segments have become underserved by banking institutions. Thankfully, enterprise electronic money solutions like Wallter have been in a fortunate position to onboard and service clients classified as higher risk.

Why Businesses Move Away from Banks

It’s not just a case of the glove fitting. Digital payment platforms offer a far more compelling solution to traditional banking services, especially in the areas of cost-effectiveness and accessibility.

Small and medium-sized businesses and practically any company making frequent cross-border payments stand to gain a lot from this new wave of alternative banking solutions, commonly referred to as e-money businesses, neobanks or challenger-banks.

Premium Customer Service

Banks significantly lack the ability or even the desire to provide a personalized approach. Even if you’re doing significant turnover with your bank, the chances are high that there are many larger and more valuable clients than your business. Regardless of your value, reliable banking and on-time payments are the lifeblood of any business. When a payment is delayed, it’s a problem. When no one can explain the reason why it’s delayed, that’s a failure.

Most banks rely on legacy technology built decades ago, complicated correspondent banking networks and maintain processes that require significant manual steps when processing and monitoring transactions. Businesses suffer every day at the hands of banks that are inherently flawed.

 Fintech companies like Wallter take a customer-first approach and take the time to thoroughly understand the needs of each client. Besides paying close attention to customers' problems and giving helpful solutions, Wallter provides a far more dynamic and transparent platform as well as a business-minded approach to how customer queries are managed.

More Accessible

E-money businesses have adopted lean digital verification methods when onboarding new clients. In comparison, banks continue to rely on face-to-face verification procedures and lots of printed documents. Offline verification is time-consuming and costly for banks. Because of higher underlying cost, banks would rather avoid doing business with smaller companies which are unlikely to generate a meaningful amount of revenue. Banks, therefore, put barriers up to prevent those less valuable clients from onboarding.

 It can take a bank several-hours or even days to do KYC on a business application. Banks employ thousands of people who are dedicated exclusively to processing new customer applications and conducting KYC. In contrast, it costs just a few dollars to do an online digital verification. E-money solutions like Wallter can easily cover onboarding related overheads from a business of any size.

Learn more about electronic money payment solutions

Whatever industry you are in and whatever size your business is, you can dramatically lower your transaction costs by leveraging new solutions, like Wallter. Get in touch with one of our digital payments experts to learn more about better methods available for making corporate payments, including our pre-paid business card solution with a 100,000 euro monthly limit.

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