Digital savings accounts have become more popular among local consumers due to convenience and additional banks are launching programs to compete with the nation’s three Web-only banks, the Financial Supervisory Commission (FSC) said yesterday.
The number of digital savings accounts opened at the nation’s 30 banks totaled 3.38 million as of the end of last year, a surge of 124 percent from 1.5 million at 25 banks a year earlier, commission data showed.
The rapid growth could be attributed to more banks launching digital services to cultivate a customer base that favors using online services over visiting brick-and-mortar branches — the target customers of the three virtual banks, Banking Bureau Deputy Director Sherri Chuang (莊琇媛) told a news conference in New Taipei City.
The three Web-only banks are scheduled to open later this year, starting with Rakuten International Commercial Bank Co (樂天國際商銀) in June, followed by Line Bank (連線商業銀行) and Next Bank (將來銀行) in the third quarter, commission data showed.
Given the intense competition, most banks offer interest rates of more than 1 percent on digital savings accounts, which is tempting compared with interest rates of 0.1 to 0.2 percent for demand deposits at banks, Chuang said.
For example, Bank SinoPac (永豐銀行) in June last year launched its DAWHO digital account service, which offers interest rates of up to 1.1 percent for demand deposits and no handling fees for fund purchases, she said.
By the end of last year, Bank SinoPac’s digital savings accounts grew to 225,000, fourth among the nation’s banks, she added.
Taishin International Bank (台新銀行) remained in first place with 1.79 million accounts for its Richart online service, followed by Cathay United Bank (國泰世華銀行) with 465,000, O-Bank (王道商業銀行) with 424,000 and First Commercial Bank (第一銀行) with 135,000, commission data showed.
“The number of digital savings accounts is expected to continue growing this year with the launch of the virtual banks and as people favor online services” due to an outbreak of the 2019 novel coronavirus, Chuang said.
There are three types of digital savings accounts, the commission said.
The first is open to new clients at a bank, but requires a Citizen Digital Certificate; the second is only available to people who already have a savings account with a bank; and the third requires no Citizen Digital Certificate and anyone with a credit card at a bank can apply, but it has the most restrictions on fund transfers, it said.
The third type is the most popular, with 1.3 million accounts, while there are 1.04 million type-one accounts and 1.03 million type-two accounts, commission data showed.
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