While neobanks have experienced a meteoric rise since the 2000s, they are now in the spotlight. Closures, takeovers, loss of profitability, they go through all directions. So who are these neobanks? What is their current context and is there really a neobank crisis? ? We answer you!
Neobanks are digital banks, accessible via mobile devices. They offer a smooth customer experience but above all free basic services, in particular obtaining a bank card and providing an account management tool.
For several years, neobanks have been very successful thanks to their low running costs. Indeed, these banking institutions do not have physical branches and have few employees. In addition, customers can manage everything directly from their mobile application and the after-sales service is done directly online !
According to a panorama created by France Fintech in 2021, neobanks reached their peak with nearly $240 billion in fundraising. In France, this represents 900 French companies valued at more than one billion dollars.
👀 Good to know!
Neobanks are considered to be Fintechs. They use technological and digital progress to shine in the field of finance and banking!
For a quick refresher on the panel of banking players, read our article: Focus on the various banking players !
Neobanks quickly emerged as pioneers of online offers. They are revolutionizing the traditional banking landscape thanks to their innovative and technology-based approach.
They offer digital services, accessible via user-friendly mobile applications and thus offer an alternative to traditional financial institutions.
The target of neobanks is not the same as that of traditional banks. Indeed, neobanks are mainly aimed at a generation of consumers digitally native. Their services are particularly suitable for younger generations and to people looking for alternatives to traditional banks, especially because of reduced or non-existent fees.
In addition, neobanks have also found a favorable response from entrepreneurs, of freelancers And small businesses. They appreciate their streamlined approach to financial services and their ability to respond quickly to their cash management and payments needs.
Today, neobanks are numerous on the market. Deploying diverse strategies, they have one thing in common: they have developed through digital transformation.
You will then find several neobanks in particular, Revolut, N26 or Qonto.
As for traditional banks, they are also developing their own solutions with, for example:
These players have experienced full growth. However, at the beginning of 2024, a whole new context is emerging and new trends are emerging. We take stock of the current context in the rest of this article.
Neobanks embody much more than a simple technological evolution in the financial landscape; they also represent ideologies that underpin their vision and mission.
Neobanks often show values that focus on transparency, Ethics And the social responsibility. They are committed to promoting responsible financial practices by encouraging financial education and by offering tools to budget management. The aim? Helping customers make informed decisions about their money!
This is for example the case of Greengot, which invest its clients' funds to support a viable and sustainable future. For each payment that customers make with their card, the neobank transfers the benefits associated with the transaction to projects that preserve the planet!
The current context of online banking is quite worrying. Between inflation and Increase in interest rates, the investments are less. Let's take a few examples to illustrate the situation:
Although these neobanks are not closing due to bankruptcy, all of them are no longer profitable.
Thus, among the remaining players, the two most profitable establishments would be:
In 2024, artificial intelligence occupies a central place in the field of fintechs, thus accelerating its development. This boom in AI poses serious risks for neobanks, including threats of cybersecurity, of documentary scams or even lack of transparency.
To alleviate this insecurity, fintechs can protect themselves with tools equipped with AI. The Financial Markets Authority (AMF) is already using this technology to keep an eye on the various financial markets.
But how can artificial intelligence be used to fight against this insecurity? We'll tell you more in the rest of the article.
To find out more about the risks involved in bank fraud, read our dedicated article: bank fraud, what are the risks and consequences?
To combat external threats in a sustainable and effective manner, Finovox has developed a counterfeit document detection solution. Its purpose? Reduce corporate document fraud by 6, so you, fintechs!
Developed using artificial intelligence, Finovox allows you to investigate in order to determine possible falsifications present on your documents.
The best part of the solution is that you get a summary PDF document at the end of your analysis. You can then share it with your teams and possibly add it to a legal file!
Do you want Finovox to become your ally in this daily fight against document fraud? Do not hesitate to contact our experts to find out more!
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