BankProv is the digital arm of The Provident Bank. This crypto-friendly bank promises low fees and for deposited funds to be cleared and available within 24 hours.
BankProv only exists online as a digital bank, and its function is a bank for cryptocurrencies and digital currencies. The Provident Bank is a traditional commercial bank that helps to back and ensure all of BankProv customers. They have branches in Massachusetts and New Hampshire and are the 10th-oldest bank in the United States. The company describes itself as “a full-service community” bank focused on customer privacy.
Although BankProv enables cryptocurrency business operations and loans, it is a traditional financial institution. It is not in any way a decentralized cryptocurrency platform. The primary function of BankProv is to help cryptocurrency investors leverage their crypto-assets in order to build crypto-based businesses.
BankProv customers have access to several cryptocurrency services, including:
Several of the main draws of BankProv is that they offer unlimited deposit insurance for account balances up to $250,000. And with $50,000 or more, users earn interest in APY. They also do not charge monthly service fees or have any minimum balance requirements.
API Banking: APIs function is to allow different apps and platforms to communicate with one another. APIs are essential for BankProv to interact with other cryptocurrency platforms. They also function to keep information sharing secure when sending and receiving money.
FDCI & DIF Insurance: BankProv insures 100% of all deposits with Federal Deposit Insurance Corporation (FDIC) and the Depositors Insurance Fund (DIF).
ProvXchange Network: Account Management
A major draw to BankProv is that they support crypto-based businesses and crypto-backed lending. Essentially, this bank aims to offer all the same services as a traditional bank and financial institution, except for cryptocurrency-based firms and investors.
BankProv offers crypto-backed lines of credit and lines of credit backed by Ether and the Ethereum network.
Lines of credit are available for companies that are backed by Ether or Bitcoin. Funds can be used to help expand operations. Other examples for loans are cryptocurrency-mining-tool, such as equipment loans.
Crypto-backed loans offered by BankProv are an asset-based facility. These loans are linked to the dollar value of the cryptocurrency. That dollar value is then pledged as collateral.
A benefit of BankProv is that they offer deposit insurance. They can do this as a branch of Provident Bank, which has provided full insurance for deposits since 1934. Provident Bank is a member of the Federal Deposit Insurance Corporation (FDIC) and the Depositors Insurance Fund (DIF). The FDIC insures each depositor to a minimum of $250,000, while the DIF insures the remaining balance.
The DIF is a private insurance fund. The insurance covers all deposits that are above FDIC limits at Massachusetts-chartered savings and cooperative banks. The DIF has provided insurance for deposits since 1934. All banks that are DIF members are also members of the FDIC. However, but not all FDIC member banks are DIF banks. The FDIC insures depositors to a minimum of $250,000. After $250,000, insurance is covered by FDIC.
FDIC is a government entity and is backed by the U.S. government. In contrast, DIF is a private organization. DIF individually holds over $270 million in assets and $100 million in reinsurance.
DIF insurance covers the following deposits:
APR is the “annual rate” charged for earning or borrowing money from financial institutions. On the other hand, APY considers compounding interest. When there is greater compounding interest, there is a greater difference between APR and APY.
BankProv offers APY (compounding interest), which is more attractive on accounts with higher balances. Moreover, accounts totaling less than $50,000 deposits do not earn any interest. The only product BankProv offers is a high-yield savings account.
Accounts with balances over $250,000 earn a 0.50% APY.
Interest rates earned in BankProv savings accounts are broken into the following tiers:
Despite the fact that BankProv is online-only, you will still need to go through KYC measures. To open an account, new applicants must provide the following information:
If you are looking for a way to leverage your cryptocurrencies anonymously, BankProv is certainly not offering that option. Essentially, BankProv offers cryptocurrency holders a way to leverage their assets while providing the backing and security of a traditional financial institution (aka, Provident Bank).
As a result, this means that BankProv must comply with the standards and regulations of traditional financial initiations.
BankProv is the digital arm of Provident Bank. Because of this partnership, BankProv can offer cryptocurrency investors many financial services, all of which are backed by the USD. As a traditional financial institution, they also provide deposit insurance for the customer’s total balance -in the form of FDIC and DIF.
There are several limitations with BankProv. Customers must comply with US federal KYC policies, accounts are only fundable with wire transfers, and those who keep less than $50,000 will not benefit from APY interest yields.
In essence, this is a bank for those who operate mid to large cryptocurrency-based businesses. BankProv is a great option for those who have high account balances (over $50,000). The services offered for building crypto-based businesses are also very appealing.
There are no fees to use BankProv, aside from wire transfers. However, if you are an individual or small business and wish to make this your primary business account, your transaction fees will rack up quickly.
So, for those who plan to leverage BankProv’s cryptocurrency lending services, they offer many great features. But for those who have more minor needs, BankProv is not ideal.