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Digital banking vs. online banking: What's the difference?

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    Digital banking and online banking are sometimes mistaken for the same thing. While both terms have some similarities, such as tools and services that may help streamline managing your money, they’re technically different from one another. Let’s look at digital banking and its online-only counterpart to clarify the differences.

    What is online banking?

    Online banking means using the internet to do your banking. Your bank’s online banking tools may be available on your phone, computer, laptop or tablet. Online banking makes most standard banking services available through your bank-operated websites.

    Imagine waking up in the middle of the night, remembering you forgot to pay a bill. With online banking, you can log in and pay that bill right away, without waiting for the bank to open. The same goes for checking your balance and making transfers.

    As handy as it might be, online banking is just one part of what we call “digital banking services.” Up next, let’s look at the wider suite of tools and services that make up digital banking.

    What is digital banking?

    What does digital banking mean? Think of it as online banking but taken to the next level. It incorporates all the familiar features of online banking, such as checking account balances or transferring money, and integrates even more tools and services.

    Digital banking is an advanced financial solution that uses technology to provide a complete set of services. Going beyond the basic features of checking your account balance or transferring funds, digital banking covers services which may include online banking, mobile banking, virtual assistants and more. This means digital banking incorporates both online and mobile banking, as these forms of banking are an important part of the broader digital banking ecosystem.

    Key differences between digital and online banking

    Online banking and digital banking may be similar in making banking services more convenient to you. But, you might find differences in the range of service and types of products they offer.


    Online banking has significantly expanded access to banking services for many people. Online banking relies on an internet connection to log into your bank’s website, making internet access necessary for online banking activities.

    Internet connectivity is also required for most digital banking functions and services. Digital banking services may include user-side tools such as budgeting software that can function without a constant internet connection, although updates or syncing would require eventual online access.

    Scope of digital banking services

    The spectrum of services in online banking primarily focuses on core banking activities provided over a web-based browser. These activities encompass tasks we’d traditionally do at a brick-and-mortar bank like checking balances or transferring money.

    Digital banking services, however, cast a wider net. Along with supporting basic banking functions, they offer a variety of additional services ranging from integrated financial management platforms to even more tools like options for tracking and reducing your carbon footprint through your spending habits.

    Available products

    The products that you can typically access through online banking mirror those available at a physical bank branch: banking basics like checking accounts, savings accounts and loans.

    On the other hand, digital banking takes many of these basic banking services and leverages recent advancements in technology to provide a more comprehensive and personalized experience. Digital banking platforms might use machine learning algorithms to create smart budgeting tools that learn from your past transactions and provide tailored financial advice based on your spending patterns.


    Both online and digital banking platforms take security seriously, implementing a variety of measures to protect your personal and financial information. Online banking typically uses secure encryption protocols, two-factor authentication and other security measures to help keep your transactions and account safe.

    Digital banking platforms may incorporate even more advanced security features such as biometric authentication, behavior-based artificial intelligence algorithms that detect unusual activity and secure third-party integrations. These extra layers of security are designed to help provide more protection against modern cyber threats.

    In summary

    Understanding the difference between digital banking and online banking may help you get the most out of these potentially useful tools. Both aim to offer improved convenience, with online banking covering core banking needs over the internet and digital banking expanding this scope with a wider array of features. Keeping this in mind, it might be time to explore the conveniences of managing your finances from the comfort of your own devices.

    Learn more about the differences between online banking and digital banking.

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