Home Business Insights & Advice How Neobanks are changing traditional banking together with fintech unicorns

How Neobanks are changing traditional banking together with fintech unicorns

by John Saunders
16th Mar 22 2:03 pm

Neobanks together with fintech companies have already taken a certain niche in the global financial system, influencing traditional financial organizations. What qualities allow them to do this? How do fintech unicorns satisfy today’s customers? And what trends make up the modern fintech world? Let’s discover this in the article.

What “fuels” unicorns – a few words about trends

Neobanking, digital payments, insurance, investing, and wealth technology (developments for retirement planning and investing) are just a few of the areas in the industry. The spike in trading activity since the epidemic, as well as the quick growth of crypto money, are helping to promote wealthtech around the globe.

But what else has a beneficial effect on fintech?

  • Digital assets aka cryptocurrency

Cryptocurrencies are rapidly developing to spread over all available niches of traditional finance, despite the backlash from officials.

Many enthusiasts have recognized crypto money as a replacement for gold, trying to secure investments against the backdrop of inflation in fiat currencies. What’s more, such juggernauts as JPMorgan Chase also offer various tools for processing cryptocurrencies.

  • Microinvestments

The pandemic has demonstrated that many people would like to get involved in retail trading and microinvesting. Fintech companies that offer similar opportunities have caught a friendly wind. They provide an unprecedented degree of democratization in the traditional investment and trading sector.

  • Bots-consultants

Fintech tools like Robinhood have made their way into the pockets of individuals in the form of mobile apps. You can open a brokerage account online in a couple of seconds, and most firms provide trading access 24 hours a day, seven days a week.

Nonetheless, not every micro-investor is willing to take risks in the market. Trustees, investment advisors, internet forums, and other professionals can provide professional advice on which assets to invest in. However, using bots is the simplest solution. As a result, robo-advisers are regaining momentum.

  • Neobanking

Neobank is an institution that operates with payments and currencies only in the digital space

Neobanking allows people to solve various financial issues without visiting financial institutions. Both digital developments and the pandemic are adding to the popularity of neobanks. Today, there are about 300 operating neobanks in the world, while, according to statistics, even more, such projects are now developing.

The general thought

All in all, our future doesn’t depend on neobanks and fintech companies. The new financial models that they apply hold the key to the future.

Their competition with other tech giants is heating up, blurring the lines in the fintech world. Financial services will be offered by IT brands, while digital services will be provided by banks and fintech software development companies. Many observers believe that a business like Apple or Google would eventually overtake traditional banks and become the greatest fintech companies of our time.

Unicorns in this space will continue to benefit from technological advancements such as open banking. Its interfaces allow greater chances for free financial data exchange.

They will develop unique fintech add-ons to help small and medium firms, freelancers, and individual entrepreneurs reach more B2B segments.

Fintech firms and neobanks will build their own ecosystems to boost their market state as the number of consumers grows. This will trigger great rivalry that will blur the lines between financial and technology companies.

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