Neobank or Digital Bank has won the world by taking $10 billion from Brazil’s Nubank and $3.5 billion from Berlin’s N26, now $14.5 billion as a valuable consumer end to chime. United States. Neobank has led a $3.6 billion venture capital fund for customer fintech startups this year.
In addition, as the coronavirus-fuel acceleration of digital conversions continues, it looks like Digital Bank will stay here, with some estimates that by 2020 it will reach 60 million customers in North America and Europe and exceed 145 million by 2024. The space is becoming more and more crowded a trend that simply feeds the world and creates a much larger infrastructure that enables an organization to incorporate a bank account as a product account.
As a result, Neobank are not monotonous models and not all created equal. Looking under the hood of business models around the world reveals remarkable operational differences and highlights specific features that are more likely to be successful in the end.
Five global models of neobanks
Today there five distinct models that are leading the world:
Interchange-led: Depending on the revenue to be paid, the revenue is encouraged through the exchange as the driver. Every time a customer uses a Neobank card as a payment method, they paid [e.g. chime / US; Neon (hybrid of 1 and 2) / Brazil].
Credit-led: Starting with a credit card or similar offer and then providing a bank account, the credit-first model earns [e.g. Neobank, Neon (hybrid of 1 and 2) / Brazil].
How are neobanks solving core banking problems?
Do you understand that people easily fall for the rules? When you visit a bank branch, there is an assembly line of your instructions that you follow, but pause there – if that means you have to follow the instructions to get some access. Just using a blue cloth to wipe the table is not your mother’s rule. No. Here, you should make a choice. You need to have a banking experience that is DIY and so comfortable, like a craft session. Therapeutic, if we can say it.
Neo-banking does it for you. It makes you feel good about banking. We start by saving you the problem of going to the bank. If you can land a job without physical interaction, why do you have to go to a bank branch for a service? Neo-banks are digital-first banks that bring all services to your fingertips. In addition, it not just the services we design for you; it is the services you want. For example, Jupiter means, we are asking our potential customers to flood us with the product/service they want. We co-create our products because we want you actually use them. How can you build a ship and not ask the captain where he wants the wheel of his ship?
