Fintech companies have seen considerable growth in recent years, especially in developing countries like India. The chances of startups succeeding is more in a developing country where the masses are interested in technologically advanced resources but lack access. Some industries dominate more, and fintech services, online banks, or neobanks are on top. Millennials, in general, are inclined toward more technologically up-to-date services.
Neobanks and online banks are gaining momentum in India, causing shaky grounds for traditional banks. The younger generation prefers fintech solutions related to banks and other financial services. Neobanks allow you to transfer money, make payments, and check your bank status. These online banks are 100% digital and provide all the features a regular bank would.
But what makes neobanks unique? Online bank accounts are easy to use. The features of neobanks are innovative because the developers and founders of the younger generation design them. These newer developers know what’s trending and what attracts millennials and gen z. Online bank accounts are made in a way to cater to the needs of the younger generation. Online bank accounts take the idea of traditional bank accounts and transform them into an all-purpose fintech solution. The apps of the neo banks or online bank accounts are also more advanced and have features that conventional banks lack. Traditional banks also have apps and digital components, but their apps are notorious for low-quality service and not being customer-friendly. Whereas online bank accounts have excellent customer service.
There are many differences between digital online bank accounts and traditional banks, but the most obvious ones are their physical presence. Traditional banks have branches and physical ATMs that customers can visit. Digital online bank accounts have no physical presence and are also highly cost-effective and charge reasonably. How do neobanks work that they offer affordable service charges, you may ask? These online bank accounts are entirely digital, so they have fewer employees. It saves them money and resources, which they utilize for customer satisfaction. Usually, these banks collaborate with traditional banks because they are non-licensed fintech companies. The main reason behind the success of neobanks and fintech companies, in general, is they heavily rely on customer data. It means that they analyze customer behavior and patterns and put actual effort into customer satisfaction.
What are the benefits of neobanks?
Unlike traditional banks, neobanks do not charge monthly maintenance fees as they save a good amount of money on overhead expenses. The process of online open bank accounts is extremely simple. Since these companies do not have many employees to maintain and are usually run by smaller groups, the funds needed for running neobanks are far less than the funds that one will require for running any traditional bank. It is why neobanks can offer lower fees, and you can enjoy reasonable offers from time to time. Online open bank accounts also have a higher interest than ordinary banks for your savings accounts.
Another benefit of neobanks is that it is easy to open new bank account and use it. Even youngsters with less financial knowledge can comfortably open new bank accounts. You can set up an account with neobank within minutes through their apps. On the other hand, standard banks take too long to set up and require a lot of documents and multiple visits to the branch, making the process lengthy. Since you can operate them digitally, you will have access to their services 24/7, anywhere in the world. You can open new bank accounts and access them anywhere with the internet and a computer or mobile. You can manage all your financial requirements like making payments, transferring money, depositing checks, etc., making your job smooth sailing.