Global Neo and Challenger Bank Market, By Type (Neo Bank, Challenger Bank), Application (Personal, Business), Services Provided (Checking and Savings Account, Payment and Money Transfer, Loans, Mobile Banking, Investment Accounts, Retirement Savings, Others) - Industry Trends and Forecast to 2029
Market Analysis and Size
According to Forbes, banks are expected to become invisible, connected, insights-driven and purposeful by the year 2030. Consumers are inclining towards neobanks and digital challenger as they are more digital, agile and innovative than a traditional banking system. These banks have successfully taken over various verticals, including payments and transfers, among others.
Global Neo and Challenger Bank Market was valued at USD 6.41 billion in 2021 and is expected to reach USD 1326.41 billion by 2029, registering a CAGR of 47.80% during the forecast period of 2022-2029. “Mobile Banking” is expected to witness high growth owing to the rapid digitization and adoption of smartphones globally. In addition to the market insights such as market value, growth rate, market segments, geographical coverage, market players, and market scenario, the market report curated by the Data Bridge Market Research team also includes in-depth expert analysis, import/export analysis, pricing analysis, production consumption analysis, and pestle analysis.
Market Definition
A neobank refers to financial tech startup that mainly focuses on delivering excellent customer experience. The major aim of the technology is acquiring as many clients as possible. It facilitates lending, payment options, and money transfers, among other banking services. Digital challenger banks are known to be similar to traditional banking institutions, but they do not require or have physical presence.
Report Scope and Market Segmentation
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Report Metric
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Details
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Forecast Period
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2022 to 2029
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Base Year
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2021
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Historic Years
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2020 (Customizable to 2014 - 2019)
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Quantitative Units
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Revenue in USD Billion, Volumes in Units, Pricing in USD
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Segments Covered
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Type (Neo Bank, Challenger Bank), Application (Personal, Business), Services Provided (Checking and Savings Account, Payment and Money Transfer, Loans, Mobile Banking, Investment Accounts, Retirement Savings, Others)
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Countries Covered
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U.S., Canada and Mexico in North America, Germany, France, U.K., Netherlands, Switzerland, Belgium, Russia, Italy, Spain, Turkey, Rest of Europe in Europe, China, Japan, India, South Korea, Singapore, Malaysia, Australia, Thailand, Indonesia, Philippines, Rest of Asia-Pacific (APAC) in the Asia-Pacific (APAC), Saudi Arabia, U.A.E, Israel, Egypt, South Africa, Rest of Middle East and Africa (MEA) as a part of Middle East and Africa (MEA), Brazil, Argentina and Rest of South America as part of South America.
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Market Players Covered
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Atom bank (UK), Fidor Solutions AG (Germany), Monzo Bank Limited (UK), Moven Enterprise (US), N26 GmbH (Germany), Tandem Bank Limited (UK), Pockit LTD (UK), UBank (Australia), PRETA S.A.S. (France), WeBank (China), Holvi Payment Services Ltd (Finaland), Hello bank (France), KOHO Financial Inc. (Canada), Rocket Bank (Russia), Soon Banque (France), Banco Bilbao Vizcaya Argentaria, S.A. (Spain), Starling Bank (UK), and DBS Bank India Limited (India), among others
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Market Opportunities
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Neo and Challenger Bank Market Dynamics
This section deals with understanding the market drivers, advantages, opportunities, restraints and challenges. All of this is discussed in detail as below:
Drivers
- Need for Advanced Features in Banking
The emergence of neo and challenger banks the banking industry incorporating advance features, client-centric products and services, and real-time services acts as one of the major factors driving the neo and challenger bank market.
- Increase in Popularity of Challenger Banks
The increase in the popularity of challenger banks owing to its services such as investments and savings accounts, mobile banking, lending, checking and merchant accounts, among others accelerate the market growth. These banks are also considered beneficial for buying and selling of cryptocurrency, insurance products and retirement savings.
- Higher Interest Rates
The increase in adoption of these banks due to their higher interest rates over traditional banks further influence the market. Also, the increase in government and regulatory supports toward banking operations has a positive impact on the market growth.
Additionally, rapid urbanization, change in lifestyle, surge in investments and increased consumer spending positively impact the neo and challenger bank market.
Opportunities
Furthermore, online offerings to unbanked population in the emerging economies extend profitable opportunities to the market players in the forecast period of 2022 to 2029. Also, the introduction of both Artificial Intelligence (AI) and Machine Learning (ML) will further expand the market.
Restraints/Challenges
On the other hand, issues with maintaining strong customer relations via online services along with good customer experience are expected to obstruct market growth. Limited profitability for these start-up banks is projected to challenge the neo and challenger bank market in the forecast period of 2022-2029.
This neo and challenger bank market report provides details of new recent developments, trade regulations, import-export analysis, production analysis, value chain optimization, market share, impact of domestic and localized market players, analyses opportunities in terms of emerging revenue pockets, changes in market regulations, strategic market growth analysis, market size, category market growths, application niches and dominance, product approvals, product launches, geographic expansions, technological innovations in the market. To gain more info on neo and challenger bank market contact Data Bridge Market Research for an Analyst Brief, our team will help you take an informed market decision to achieve market growth.
COVID-19 Impact on Neo and Challenger Bank Market
COVID-19 had a positive impact on the neo and challenger bank market due to the rise in number of end users adopting neo and challenger bank solutions tools during the outbreak of COVID-19. An increase in the adoption of these banks for services, including Payment and Money Transfer, Checking and Savings Account, and Mobile Banking was witnessed owing to the strict lockdowns and social distancing to contain the spread of the virus. The neo and challenger bank market is expected to witness high growth in the post-pandemic scenario owing to the rise in awareness regarding the potential benefits of neo and challenger bank.
Recent Developments
- In May’2022, Neo Financial became a part of Canada’s unicorns after securing a $185 million CAD Series C round at a valuation of more than $1 billion. The round marked the third consecutive round that Peter Thiel-backed firm Valar Ventures leading for Neo.
Global Neo and Challenger Bank Market Scope and Market Size
The neo and challenger bank market is segmented on the basis of type, services provided, and application. The growth amongst these segments will help you analyze meager growth segments in the industries and provide the users with a valuable market overview and market insights to help them make strategic decisions for identifying core market applications.
Type
- Neo Bank
- Challenger Bank
Small Challenger
Large Challenger
Services Provided
- Checking and Savings Account
- Payment and Money Transfer
- Loans
- Mobile Banking
- Investment Accounts
- Retirement Savings
- Others
Application
- Personal
- Business
Neo and Challenger Bank Market Regional Analysis/Insights
The neo and challenger bank market is analysed and market size insights and trends are provided by country, type, services provided, and application as referred above.
The countries covered in the neo and challenger bank market report are U.S., Canada and Mexico in North America, Germany, France, U.K., Netherlands, Switzerland, Belgium, Russia, Italy, Spain, Turkey, Rest of Europe in Europe, China, Japan, India, South Korea, Singapore, Malaysia, Australia, Thailand, Indonesia, Philippines, Rest of Asia-Pacific (APAC) in the Asia-Pacific (APAC), Saudi Arabia, U.A.E, Israel, Egypt, South Africa, Rest of Middle East and Africa (MEA) as a part of Middle East and Africa (MEA), Brazil, Argentina and Rest of South America as part of South America.
North America dominates the neo and challenger bank market due to the prevalence of the major financial institutions and increased consumer awareness within the region.
Asia-Pacific (APAC) is expected to witness significant growth during the forecast period of 2022 to 2029 because of the growth of the banking sector in the region.
The country section of the report also provides individual market impacting factors and changes in regulation in the market domestically that impacts the current and future trends of the market. Data points like down-stream and upstream value chain analysis, technical trends and porter's five forces analysis, case studies are some of the pointers used to forecast the market scenario for individual countries. Also, the presence and availability of global brands and their challenges faced due to large or scarce competition from local and domestic brands, impact of domestic tariffs and trade routes are considered while providing forecast analysis of the country data.
Competitive Landscape and Neo and Challenger Bank Market
The neo and challenger bank market competitive landscape provides details by competitor. Details included are company overview, company financials, revenue generated, market potential, investment in research and development, new market initiatives, global presence, production sites and facilities, production capacities, company strengths and weaknesses, product launch, product width and breadth, application dominance. The above data points provided are only related to the companies' focus related to neo and challenger bank market.
Some of the major players operating in neo and challenger bank market are
- Atom bank (UK)
- Fidor Solutions AG (Germany)
- Monzo Bank Limited (UK)
- Moven Enterprise (US)
- N26 GmbH (Germany)
- Tandem Bank Limited (UK)
- Pockit LTD (UK)
- UBank (Australia)
- PRETA S.A.S. (France)
- WeBank (China)
- Holvi Payment Services Ltd (Finaland)
- Hello bank (France)
- KOHO Financial Inc. (Canada)
- Rocket Bank (Russia)
- Soon Banque (France)
- Banco Bilbao Vizcaya Argentaria, S.A. (Spain)
- Starling Bank (UK)
- DBS Bank India Limited (India)
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