The global boom in digital banks: What the data tells us
- The number of neobanks worldwide has tripled since 2017, climbing from 100 to nearly 300 worldwide. That means, over the last three years, a neobank launched every five days somewhere in the world (!), according to Exton, a consultancy firm which manages a global database of consumer banking apps.
- Europe spawned the first wave of neobanks, and now counts over 100 live apps and 50m accounts, according to Exton’s database.
- Broadly speaking, neobanks make money in three ways: payment transaction fees, premium subscriptions, and commissions from third party services. But this hasn’t proven a smooth model for profitability.
- The lockdown exposed digital banks’ reliance on interchange fees and travel for revenue.