A neobank is a fintech company that offers standard banking services entirely digitally. Unlike conventional banks, neobanks don’t have physical branches and can operate without a banking license. The number of users of neobanks is growing every day. This trend according to PaySaxas can be attributed to the fact that their success is due to a number of other benefits besides online service.
They also offer:
1️⃣ Simplified way of obtaining loans. The process of obtaining loans from neobanks is more convenient and faster, because they use modern technologies to assess the credit risk of the client;
2️⃣ Low fees. Often, neobanks do not charge fees for card services and fund💸 transfers; and
3️⃣ New financial analytics solutions. They provide services to automatically analyze account movements and with it offer their users personalized financial solutions.
Benefits
Fast registration. One of the most valued advantages of digital banks is that you can open your account in up to 3 days and submit all necessary documents online.
Multicurrency accounts. Traditional banks usually provide separate accounts for different currencies, while neobanks allow for creating multi-currency accounts.
Fees and rates. As neobank owners spend less money on their maintenance, this results in lower fees for their clients and higher interest rates.
Drawbacks
Limited free services. The majority of neobanks offer free services, but this is a basic list, and you might need more for your business. In this case, you can have them in a paid plan.
Cash withdrawal fees. Among the top problems arising with neobanks is that they don’t always have their ATMs.
No physical presence. Of course, you can solve most of the issues by contacting a neobank representative online, but for some customers, this can be trouble.
