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165:(OCBC) of Singapore, launched in April 2000. It was shut down in 2011 and its operations merged into the mainstream banking structure with its parent OCBC saying that "Internet Banking has since become a core part of OCBC Bank's multi-channel strategy – which also encompasses branches, ATMs and Mobile Banking".
88:(FDIC) as their primary regulator. Many direct banks are insured by the FDIC and offer the same level of protection for the customers' funds as traditional banks, although it is important to verify if this is true. As of 2022, 27% of banking customers in the United States use a direct (i.e., online-only) bank.
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with lower interest rates than most traditional banks. However, there was initial consumer hesitation in conducting monetary transactions over the
Internet, especially with an entity that they could not deal with face-to-face.
70:. Direct banks eliminate the costs of maintaining a branch network while offering convenience to customers who prefer digital technology. Direct banks provide some but not all of the services offered by physical banks.
115:, it pioneered the concepts of no branches and 24-hour service through a call center. The commercialization of the Internet in the early 1990s was the biggest driver in the creation of fully direct banking models.
118:
In the 1990s, internet-only banks or "virtual banks" appeared. These banks did not have a traditional banking infrastructure, such as a branch network, a cost-saving feature that allowed many of them to offer
150:, providing higher interest rates than traditional banks for customers who were happy to only have access to their account on the internet. One of the first and most successful adopters of this was
95:. Neobanks are online-only banking providers without federal banking charters, instead providing a website while relying on a partner bank to hold funds. Often, the partner banks will be
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In the United States, direct banks are defined as online/branchless institutions with federal banking charters, with either the
Federal Reserve Board, the
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in Canada in 1997, expanding this to the United
Kingdom, Australia, and the United States before its owner sold them around 2010.
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50:, email, and other electronic means, often including telephone, online chat, and mobile check deposit. A direct bank has no
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143:. While SFNB did not make much profit in its initial years, it demonstrated that the concept of direct banking could work.
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Direct bank transactions are conducted entirely online. Direct banks are not the same as "
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99:. Their customers tend to be younger people who are more price sensitive to bank fees.
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139:(SFNB), launched in October 1995, and was the first direct bank to be insured by the
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77:". Online banking is an Internet-based option offered by regular banks.
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In the United States, direct banks are distinctly different from
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One of the first direct banks in the United States was the
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Asia's first direct bank was finatiQ, a division of the
227:"What is Online Banking? Definition and How It Works"
46:that offers its services only via the Internet,
168:The direct bank model was used by many of the
311:"2022 U.S. Direct Banking Satisfaction Study"
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107:One of the world's first direct banks was
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82:Office of the Comptroller of the Currency
341:. Asia Banking and Finance. May 8, 2011.
58:network and may also provide access via
54:. It may offer access to an independent
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27:Bank that only offers services remotely
141:Federal Deposit Insurance Corporation
86:Federal Deposit Insurance Corporation
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172:created in the UK during 2015–2018.
251:Frankefield, Jake (24 March 2022).
163:Oversea-Chinese Banking Corporation
146:Some direct banks focused only on
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283:Federal Deposit Insurance Company
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286:. 28 July 2014. Archived from
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339:"FinatiQ to cease operations"
225:Beers, Brian (24 June 2021).
309:Effler, Geno (12 May 2022).
137:Security First Network Bank
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278:"Safe Internet Banking"
148:online savings accounts
203:Online savings account
34:(sometimes called a
290:on 12 October 2017
18:Branchless banking
64:interbank network
16:(Redirected from
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253:"Online Banking"
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121:savings accounts
66:alliances), and
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156:Tangerine Bank
154:that launched
125:interest rates
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75:online banking
52:branch network
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321:. Retrieved
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292:. Retrieved
288:the original
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257:Investopedia
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234:. Retrieved
231:Investopedia
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190:Banks portal
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123:with higher
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113:Midland Bank
109:First Direct
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68:bank by mail
40:virtual bank
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323:6 September
294:6 September
262:6 September
236:6 September
32:direct bank
353:Categories
318:J.D. Power
209:References
152:ING Direct
48:mobile app
176:See also
93:neobanks
364:Banking
103:History
84:or the
42:) is a
314:(pdf)
129:loans
325:2022
296:2022
264:2022
238:2022
127:and
60:ATMs
44:bank
38:or
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217:^
30:A
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20:)
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