Which is better, neobanks or challenger banks?

Neo and challenger banks have grown quite a bit over the past decade. Both offer flexibility and access to a wide range of services originally coming from traditional banks. Neo banks provide a platform—more than just your current account, other things like expense management, automated accounting services, payroll, etc. They provide a a wide variety of add-ons made available on top of traditional banking needs. More importantly, from a service standpoint, they made available these APIs to integrate a lot of the business workflows. Challenger banks are actually also leveraging technology to streamline the banking operations process but they do maintain a limited brick and mortar presence. Revolut, Tandem, Metro are some of the popular ones. What was under one roof with a traditional bank is now being broken down in a way that allows for optimization, efficiency, and most importantly for consumers, a level of flexibility and ease of use. With traditional brick and mortar banking, you may talk to somebody who may or may not give you the service that you want. I typically boils down to total assets being held at the bank.

Anonymous Author
Neo and challenger banks have grown quite a bit over the past decade. Both offer flexibility and access to a wide range of services originally coming from traditional banks. Neo banks provide a platform—more than just your current account, other things like expense management, automated accounting services, payroll, etc. They provide a a wide variety of add-ons made available on top of traditional banking needs. More importantly, from a service standpoint, they made available these APIs to integrate a lot of the business workflows. Challenger banks are actually also leveraging technology to streamline the banking operations process but they do maintain a limited brick and mortar presence. Revolut, Tandem, Metro are some of the popular ones. What was under one roof with a traditional bank is now being broken down in a way that allows for optimization, efficiency, and most importantly for consumers, a level of flexibility and ease of use. With traditional brick and mortar banking, you may talk to somebody who may or may not give you the service that you want. I typically boils down to total assets being held at the bank.
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Anonymous Author
I think if you look at challenger banks and neobanks, for both their aspirations are to be online, fully digital. I think the main difference is; challenger banks actually have banking licenses, neobanks don't. Neobanks are writing upon the licenses of their underlying partners and trying to be value add. That's just layering on legacy infrastructure and approaches.
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