Digital Banking Business 💸

What is Digital Banking?

Digital banking, also known as Internet banking, has grown exponentially over the past decade. It allows regular customers, including an individual or a business, to take total control of their finances in a safe and efficient manner. This big available market was made more popular by the pandemic and has seen more startups and businesses move into this space to build efficient digital banks. There is no way to run but forward.

How Does It All Work?

But how does it work and how do you build a digital banking platform from start to delivery and continuous iteration? This use case aims to answer that question and break down the technical know-how and business decisions involved in building a digital bank on a modern infrastructure such as what we have here at Woodcore.

Building on or joining such ecosystems makes absolute sense if building on inclusive solutions like Woodcore.

The Big Picture - Business Proposition

While some digital banking business models are more relevant to financial inclusion for the unbanked than others, the overall impact of the innovation in the ecosystem is to unbundle value chains that could prove beneficial for low-income customers and the providers who serve them.

At Woodcore, we’ve got just every type of customer and their providers covered by providing an all-inclusive platform via our value-focused APIs and user interface that can be molded into specific models.

In this use case, we explore how QualityPay is using Woodcore’s technology to stay relevant and thrive ahead of the competition.

Let’s Dive In

QualityPay is a digital banking platform registered in Nigeria with the goal of building an all-inclusive banking system for all types of customers, including both high-income and low-income customers. They’ve been at the drawing board for months now trying to iron out every necessary detail in the journey from product implementation to market entry.

However, they do not wish to build from scratch as that would take a longer period of time and would also require more hands in their technical department. Building on our solution at Woodcore seemed just like the best decision and a way to get their digital bank up and running in no time.

Here’s how they did it!!

The Solution

QualityPay would be building a cross-platform digital banking system that would run on both Android and iOS devices, but that was just on the surface. For their back office, they need their solution to do the following while leveraging Woodcore's core banking system:

Provide a range of products for personalized consumer experiences.
Onboard new customers and create a Customer Information File (CIF).
Create a NUBAN for customers and assign specific privileges according to their selected product configuration.
Create Deposit, Withdrawal, and Transfers of funds.
Accounts management.
Settlement and reconciliation to the necessary accounts.
Simplify open banking compliance.

Provide Products for Personalized Banking Experiences

QualityPay’s business model revolves around the ability to create savings, loans, and investment products which made it easier to build on Woodcore due to the presence of the following key banking products:

Deposit Products (Savings and Current Accounts): Savings and Current accounts can be created using Woodcore. This is core functionality for digital banks. All we need to do is define the configurations of these products, and Woodcore will do the rest.
Loan Products: These products can be used to manage the entire loan management process within a digital bank.
Investment Products: Products like term deposits and fixed deposits can be created using Woodcore.

Onboarding on WoodCore

QualityPay being a digital bank was easily onboarded on Woodcore within two months. The yardstick for the duration in onboarding depends on the number of customer accounts to be migrated from the previous core banking application to Woodcore along with the technical aspect of the digital bank being handled by the bank's product team.

A customer onboarding process on QualityPay would go through the following steps:

An account creation API request is made from QualityPay’s portal to Woodcore.
This process creates a customer information file and a deposit account, attaching a Nigerian Uniform Banking Account Number [NUBAN] for the customer.
An SMS alert notifying the customer of the newly created account via Termii and also for deposits and withdrawal alerts.

Accounts Management

Managing financial accounts and services is considered the day-to-day responsibility of any digital bank. With Woodcore, QualityPay was able to manage their customer accounts and information by going through the processes listed in Onboarding on WoodCore above, and thereafter on the Woodcore CBA.

Create Deposit, Withdrawal, and Transfer of Funds

As with any digital or conventional bank, the lifecycle of funds in QualityPay, i.e., deposit, withdrawal, and transfer is a critical part of operations. For customers on the platform to initiate any of these processes, an API request is made to Woodcore.

The requests are validated and if all the request parameters are correct and valid, a successful deposit, withdrawal, and transfer of funds are initiated for the customer.

Integrations

For integration with NIBBS to be facilitated, QualityPay just needed to introduce us as their Technical Partner and every other necessary detail was handled on our infrastructure.

Integrations with Paystack, Fincra, and other key banking technology providers are available. This made it easy for QualityPay to use Woodcore as a central source of truth for all their core banking needs to power the digital banking platform.

Summary

Building a digital bank entails a lot of critical business and technology decisions. These decisions and steps involved in launching an effective digital bank can be made easier based on the tool you use.

This use case covers the steps and decisions involved in building a digital bank on Woodcore’s infrastructure. However, if certain details are not clear to you, speaking with us would answer most of these questions.