As neo and challenger banks disrupt traditional global incumbents, we rate the leaders from a stodgy, slow-moving space to one that’s innovative and dynamic. Almost all digital banks provide low-cost services which are delivered fast than those offered by their incumbent counterparts. So, let’s take a look at the global top 10 digital banks
#10 Judo Bank
This Australia-based Judo Bank was founded in 2018 and already serves over 10,000 customers, making it one of Australia’s most recent unicorn fintechs. It serves both business and individual customers. In 2020, it raised $ 216 million in seed funding, and in 2021, it was valued at $ 2.6 billion. This is a certain 100 percent mind-boggling increase in JudoBank’s 2019 market value.
Since its founding in 2013 by technology experts, MoneyLion has been a rising star in the banking industry. Initially, it provided financial services, but it has since expanded to investment and lending products. This fintech expanded into the realm of digital banking. MoneyLion partnered with Fusion Acquisition Corp to launch its IPO in 2021, resulting in a combined equity valuation of $ 2.9 billion.
Monzo, a London-based banking upstart valued at $1.6 billion, was founded in 2015 and currently serves 5 million customers in the UK and US. In 2016, its digital banking app raised over $1 million on Crowdcube, setting a new record. Blomfield resigned as CEO in May of 2020.
#7 Starling Bank
Starling Bank, founded in 2014 in London by banking veteran Anne Boden, is a digital challenger that specialises in business current accounts. It raised $152.5 million in 2022, with a pre-money valuation of approximately $2.9 billion. Starling bank currently serves 2,7 million customers, and its revenue increased by a staggering 600% in the previous fiscal year.
This bank, which was founded in 2013 and is headquartered in Germany, is led by young entrepreneurs. It has seven million or more customers in 24 countries. Currently, it is one of Europe’s most impressive neobanks. N26 has left the UK market, citing Brexit, and is now solely focused on the European market. The closest competitors to N26 are Revolut and Monzo.
SoFi, an acronym for ‘Social Finance,’ was founded in 2011 in San Francisco with a US$ 2 million loan to connect newly-graduated Stanford students with alumni. Mike Cagney, James Finnigan, Ian Brady, and Dan Mackenzie were the founders. SoFi acquired full-service national bank status by October 2020 and is now valued at $5.26 billion. Despite this, pre-IPO estimates suggested that SoFi would be worth nearly $9 billion by 2021.
Chime operates primarily in San Francisco and is currently valued at $14.5 billion. It specialises in retail banking and serves approximately 12 million customers, making it the most valuable retail-serving fintech startup in the United States. During the pandemic, the bank’s clients’ increased reliance on digital channels resulted in an unexpected growth of nearly 50 percent.
Tinkoff was founded in 2006 in Moscow and is renowned for having the longest-established digital banks. It currently has approximately thirteen million customers. Tinkoff is estimated to be worth US$17 billion based on data from its London Stock Exchange (LSE) listing, and it has just revealed that its total assets are worth RUS1.318 billion, a figure that has increased by an astounding 50% annually. Despite the difficulties of recent months, Tinkoff’s total assets have increased annually since 2018.
Revolut, a London-based company founded in 2015, took the European banking industry by storm. It was recently valued at approximately US$ 33 billion. It also partnered with fintech titan Stripe as a strategic move to provide the business hub with a broader range of products. Revolut left Canada in 2021, citing difficulties in obtaining a licence to operate as a full bank within Canada’s financial sector. The move followed the 18-month-old successful launch of Revolut’s beta version in Canada.
Nubank became the most successful digital bank to date after launching in 2013 as a direct response to Brazil’s overcharging, undeserving incumbent banks. It reflects a desire to create something completely new and reflects the streamlined nature of Nubank’s products. This challenger bank currently serves an estimated 70 million customers, with a predicted valuation of US$ 126 billion by 2025 based on current growth forecasts. The NPS score of +87 for Nubank is just one indicator of its popularity among customers.
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