What do virtual banks lack that traditional banks have?

Virtual banks are primarily characterized by their lack of physical branches or locations where customers can go for in-person banking services. Instead, they operate entirely online, allowing users to manage their banking needs through websites or mobile applications. This model can lead to lower operating costs and, often, more favorable interest rates or lower fees compared to traditional banks, which maintain physical presence.

While traditional banks offer a range of services, including in-person consultations and walk-in access to cashiers, virtual banks provide those services digitally. They still offer online services, mobile applications, and ATM access through partnerships or networks, so the defining feature that sets them apart is the absence of physical locations. This distinction is key in understanding how banking operations vary between traditional and virtual models.