What is a White Label Banking System?
In today's digital age, financial institutions are constantly seeking new ways to enhance their services while also reducing their expenses. Adopting a white-label banking system is one approach they are using to achieve this goal, as creating a payment software from scratch is a time-consuming procedure that necessitates hiring an experienced technical team, overseeing the development process and adhering to financial regulations. This process may take years and as the payment market is constantly evolving it might end up as a waste of valuable resources.
However, by using a white-label solution, payment businesses can quickly introduce their payment services without having to create their own solution. In this article, we will examine what a white-label digital banking system is, its benefits and features for financial businesses. Also, we will explore why a fintech company should choose a white label banking solution over building a platform from scratch.
How Does a White Label Banking System Work?
When a fintech partners with a white label banking system provider, like Finti, the provider offers a complete suite of pre-built banking services that can be customized to fit the fintech's brand and requirements. These services can include online banking, mobile banking, accounts, card issuing and much more. The fintech can choose which services to offer and how they are priced, as long as the BaaS or the Financial Institution provider that we are integrated with, provides such service.
Benefits of a White Label Banking System
There are significal benefits and advantages to using a white label banking system against developing an in-house one which includes:
- Cost Savings
Building and supporting your own software solution along with the respective technology infrastructure from scratch can be expensive, time-consuming and risky. By using a white label banking system, banks can save on these costs while still offering their customers a wide range of services.
- Speed to Market
Launching new services quickly is crucial for staying competitive in the financial industry. By partnering with a white label banking system provider, like Finti, banks can launch new services in a matter of weeks, rather than months or in some cases even years.
- Customizability
Banks can customize the white label banking system to their brand, look and needs, including branding, pricing and features. This allows them to create a unique environment that fits their and their customers' needs.
- Scalability
White label banking systems are designed to be scalable, meaning they can handle an increasing number of users and transactions as the bank grows. This eliminates the need for banks to constantly invest in new technology infrastructure.
Key Features of a White Label Banking System
White label banking systems typically offer a wide range of ready to deploy features like:
- Core Banking Services
This includes accounts, card issuing, transfers and other financial services that are essential for banking customers.
- Digital Banking Services
This includes online banking, mobile banking through dedicated smartphone applications and other digital services that allow customers to manage their accounts and perform transactions remotely.
- Security and Compliance Features
White label banking systems are already compliant with strict security and compliance regulations, like KYC / KYB (Know Your Customer) procedures, AML (Anti-Money Laundering) rules, transaction monitoring and GDPR (General Data Protection Regulation).
- Customization Options
White label banking systems are made to be customizable so they can fit any bank's requirements, including branding, colors, custom pricing templates and management features.
How to Choose a White Label Banking System Provider
Choosing the right white label banking system provider is crucial for the success of any banking institution and banks should choose wisely, as there are dozens of providers available. The key factors that should affect the final decision making should be:
- Integration with Existing Systems
Any white label provider have integration with third party service providers, like BaaS providers (eg Railsr, DiPocket), KYC / KYB providers, transaction monitoring providers, acquirers etc. The most off the shelf integrations they provide, the easier and faster a bank will go live.
- Security and Compliance Considerations
The provider must have a robust security and compliance framework in place to ensure that the bank's customers' data is protected.
- Customer Support and Service Level Agreements
A reliable and fast customer support is often a vital key feature that most oversee but might have a huge impact on the day to day issue resolution. Also, specific service level agreements should be in place to ensure that any issues are addressed promptly.
- Cost Considerations
The provider's pricing model must be transparent and affordable, with no hidden costs or fees.
Future Trends in White Label Banking Systems
As the banking industry continues to evolve and customer's needs are increased, white label banking systems are likely to become even more popular, as they will offer key benefits to banks and financial institutions, to name some:
- Increased Focus on Customer Experience
White label banking systems will prioritize customer experience and user-friendly interfaces to stay competitive.
- Greater Integration with Fintech Startups
Future Fintech Startups will likely choose to partner with White label banking providers, like Finti, to offer innovative new services and features.
- Emphasis on Data Analytics
Further leveraging of data analytics will provide valuable insights into customer behavior and preferences and provide significant feedback to banks.
Conclusion
In conclusion, white label banking systems offer a cost-effective and customizable solution for banks that want to offer a wide range of services to their customers without investing heavily in technology infrastructure. However, banks must carefully choose a provider that can effortlessly cover their needs, offer reliable customer support and service level agreements and have robust security and compliance measures in place.
