How do I open an account, deposit money into and withdraw money from a digital bank?

If you are interested in digital banking services, the first step to take, naturally, is to open a digital bank account. Yet, as there may not be any bricks-and-mortar branches, how do you open an account with a digital bank?

Digital banks make wide use of fintech in place of human-operated services. “Remote account opening” is one of the examples. Using a mobile phone, clients can access the mobile app or the website of a digital bank, scan proof of identity, take a selfie and submit certain personal information to complete the account opening procedure. Compared with the need to spend time queueing up to open an account at a conventional bank, “remote account opening” is undoubtedly more efficient and convenient. Some conventional banks also offer this service.

As for deposits and withdrawals, a digital bank is connected to Fast Payment System (FPS), the instant, cross-platform transfer system. Clients can transfer funds in and out through this channel. Furthermore, depending on the service offered by the digital bank, clients can also make cash deposits or withdrawals via ATMs or branches, if any.

Both digital banks and conventional banks are licensed banks and regulated by the Hong Kong Monetary Authority (HKMA). Although digital banks operate differently from conventional ones, they are required to comply with the same set of prudent regulations as conventional banks. In addition, digital banks and conventional banks are both members of the Hong Kong Deposit Protection Board. Each customer who makes a deposit into a digital bank is also entitled to deposit protection of up to HK$800,000. Despite that there may not be any physical branch, a digital bank must maintain a physical office in Hong Kong as its principal place of business in the territory to deal with client enquiries or complaints.

Technology-related risks are of vital importance to digital banks, in particular information security, system resilience and business continuity. A digital bank must have appropriate security and technology controls in place and engage a qualified expert to perform an independent assessment. The assessment report must be submitted to the HKMA. Learn about what to be aware of as a digital bank customer.