 | This articleneeds additional citations forverification. Please helpimprove this article byadding citations to reliable sources. Unsourced material may be challenged and removed. Find sources: "Neobank" – news ·newspapers ·books ·scholar ·JSTOR(March 2024) (Learn how and when to remove this message) |
Aneobank is a type ofdirect bank that operates exclusively usingonline banking without traditional physicalbranch networks. They challenge traditional banks.[1][2][3]
The termneobank has been in use since at least 2016[1] to describe fintech-based financial providers that were challengingtraditional banks. There were two main types of company that provided services digitally: companies that applied for their ownbanking license and companies in a relationship with a traditional bank to provide those financial services. The former were called challenger banks and the latter were called neobanks.
The term "challenger bank" is used in theUK to refer to a number offintech banking startups that emerged in the wake of the2007–2009 financial crisis. Their services may be accessed by clients through their respectivecomputers ormobile devices.
Neobanks are operational inAustralia and include banks such asUp,Judo,Alex.[4]
The concept of neobanks was first noted inBangladesh around 2020.[5][6] These banks would be digital only with customer accounts not connected to any particular branch.[7]
InIndia, a neobank is a class of digital-only or online bank that operates without physical branch locations.[8] They typically have lower operational costs, which can sometimes result in lower fees and more competitiveinterest rates for their customers. Neobanks often partner with well-established, traditional banks to provide services and adhere to regulations.
Neobanks in India typically offer a range of financial services, includingsavings accounts,current accounts,debit andcredit cards, and other banking services. They focus on providing a seamless and user-friendly digital banking experience to a younger audience, with features like instant account setup, easy money transfers, and expense tracking. Some neobanks also target specific customer segments, such asmillennials, and offer features like budgeting tools and investment options to that demographic.
Indian neobanks primarily operate inIndian rupees and may have limited cross-border services. International transactions are often handled in partnerships with traditional banks.Federal Bank has partnered with Jupiter and Fi in the neo-banking space.[9]
Neobanks inIran are legally digital branches of banks.Central Bank passed a limiting law in 2022 which bans banks from starting mobile "neo" bank apps that have their own core.[10] There are a number of active programs such asOmid Bank,Tobank,Wepod and Zpod Kidzy,[11]Bank Mellat Plus.[12] Iranians need Identity national smart cards and video confirmation to open an account.[13]
 | This finance-related article is astub. You can help Wikipedia byexpanding it. |
