#NeoBanks #FintechIndustry

Neo Banks taking over Fintech Industry

Neobanking has become a buzzword in the fintech community. The term has gained momentum since it’s been taking the spotlight on the news and media. Neobanks are taking over the fintech industry by a storm, on a global level. We see a new player on the market every day whose primary intention is to simplify financial services to a greater extent. Let’s understand what it truly means. As the financial landscape is shifting towards customer experience and satisfaction, a gap has developed from what the traditional banks offer to what customers expect. And, Neobanks are making an attempt to fill that gap. Most traditional banks are bogged down by their legacy-based infra. So, they crumple when it comes to aiding SMEs with financial services like providing a payment gateway, invoicing software, multiple views of cash management, among others.

Recently, we’ve seen a massive drift in the finance industry. With over 2000 fintech players in the country, digital payments are embraced at such a large scale. Customers are moving away from physical banks and physical cash, and moving more towards online banking and wallets. More and more people are getting comfortable making online payments through GooglePay, Paytm, PhonePe, and more, now more than ever. If we think about these numbers, we can see the potential neobanks have in the country. Neobanks provide the fluidity that traditional banks don’t. They can easily sustain themselves and turn out to be profitable. Going forward, neobanks have a completely different business model altogether. But, like traditional banks, neobanks do make money marginally between money inflow and lending. ICICI Bank, India’s largest private bank has taken a lead in the Neo Banks segment and has partnered with three Neo Banks, Open, Instant Pay and Yelo.


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