With plenty of app-based banks springing up in the digital realm, the concept of neo banks is also thriving in financial sectors 24 hours a day, with no opening hours to stress over, thanks to the internet simplifying banking services at the touch of a simple button on the phone device.
What Does Neobanking Mean?
A neo-bank is a completely digitised bank which offers seamless integrated payment solutions. Since their portals are modernised, it is very easy to monitor, manage and analyse data to understand how the end-user is interacting with the service in the neo-banking ecosystem.
How Do Neo Banks Operate?
Since they are meant to challenge traditional bank hierarchies, most neo-banks function with a banking license under a brand of their own through ADIS (Authorised Deposit-Taking Institutions) as a third party and still are legitimate to issue their own accounts, prepaid cards, loans, currency exchanges, money transfers and also cryptocurrencies. That said, most of the financial decisions are solely based on the data retrieved from the users.
Advantages of NeoBanking
- Seamless User Experience
Imagine a frictionless experience at a bank. Without having to wait on long queues and having to fill document after document. At neo-banks, this is possible. Unnecessary customer expenses are significantly reduced and made flexible with easy to load drop-down menus and clean interfaces. By focusing on the customer fully alongside methodical help and support of virtual chatbots, neo-banks provide customised services that are secure enough to block cyber frauds from entering personal accounts.
- No Physical Bank Locations
As an internet-only bank, neo-banks trim off the need to physically visit a bank branch or a storefront in the near area and go through the tedious process of opening up a traditional bank account with all the paperwork and identity documents. Now it’s safe to say that organisations need not have to go through the hassle of hiring separate staff members to run a bank.
- Updates Features
With software and technology, it is imperative that organisations constantly keep an eye on updating new features and products. Therefore, it is for this reason that neo-banks regularly conduct consumer research in real-time prior to introducing a new product service, in order to make sure that whatever they implement or do will directly affect the user’s needs. Given a customer’s busy schedules, neo-banks take into consideration their time and efforts to use complex software. In essence, neo-banks are best known for generating updated concise and easy to use features that prioritise consumers more than anything else.
- Easy Set-Up
Cutting back so many general bank procedures of having to wait for your card to produce and start with money transactions, neo-banks allow flexible options for users to set up personal accounts through a virtual onboarding process. You can make payments and manage budgets using your phone number only.