Nine things to know about Neo banks

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It is difficult to imagine a world where there is no online banking. In today’s time and age, customers are availing banking facilities online, especially post Covid-19 outbreak. People are avoiding bank visits, which raises the question of these brick and mortar banks becoming redundant. New age online banks also called neo banks will take up the charge of online banking.

Here are nine things to know about Neo banks

1. Neo banks are basically digital banks which means they do not have any bank branches, headquarters, or any physical presence. They exist online.

2. These banks do not have a banking license of their own. They partner with a regular bank and offer a wide range of financial services through them. These are affiliated with existing licensed banks.

3. Neo banks are an emerging technology like artificial technology, and machine learning to offer highly personalised customer services. The app learns about a customer’s preferences through his/her transactions and automates accordingly.

4. Neo banks’ operational costs are low and customers pay lower fees compared to traditional banks.

5. Neo banks eliminate the tedious process of account creation. Customers can open an account at any time and at any place.

6. International transactions are easy with Neo banks.

7. Transactions done via Neo banks are immediate and details are given immediately

8. Neo banks have a different business model altogether.

9. There are ten neo banks in India and more players are slated to enter the segment.