Are Neobanks poised to stay in financial landscape?

Are Neobanks poised to stay in financial landscape?

Neobanks have raised the concerns of the public everywhere in Europe. Revolut, N26, Nickel, Starling, Monzo etc. are already known as key players in the industry. Most of them have succeeded massive fundraisings and are quite close to announce new capital injections in the press or the launch of new products and services.

Despite impressive customer acquisition (more than 1 million customers for N26, twice much for Revolut…) none of these mobile-only neobanks have reached sustainable profitability.

Neobanks are still cash-burner companies and even if many of them are generously funded by venture capitalist or established commercial companies, they need to evolve if they expect to stay alive and last as key players on the banking scene.

In this article we will check if Neobanks are equipped to stay or not.

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Neo Banks - Why are they so hot nowadays?

Neo Banks - Why are they so hot nowadays?

The example of Revolut which is arguably taking the lead in Europe and beyond, being one of the most innovative.

Our world is changing and is changing fast. Over the past few years, there is been a bunch of new players launching their banking apps in Europe and all over the world. Compte Nickel, N26, Revolut, Atom, Fidor Bank, Starling Bank… to name a few of them. These new entrants are surfing on strong trends, benefitting from the dematerialized nature of their services and the easy accessibility through the app stores. Their marketing is eased by our increasing use of the social networks and the predominant place the internet has taken in our lives with an instant high-speed access in our pockets.

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PSD2: “The king is dead, long live the king!”

PSD2: “The king is dead, long live the king!”

Le secteur bancaire est sur le qui-vive. En janvier 2018, le PSD2 (Revised Payment Services Directive) rentrera en vigueur, amenant de nouveaux usages sur la scène bancaire européenne. Un vrai challenge pour l’ensemble des banques, qui vont devoir se mettre à jour. Beaucoup parlent de la mort des banques traditionnelles, et pourtant, celles-ci semblent aussi avoir en elles les ressources pour s’émanciper et se construire encore davantage.

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PSD2 IN A NUTSHELL

PSD2 IN A NUTSHELL

The 2nd Payment Services Directive (PSD2) establishes rules concerning:

·         Respective rights and obligations of payment service users (PSU) and payment service providers (PSP).

·         Transparency of conditions and information requirements for payment services.

PSD2 aims at making payment more secure and cheaper, further opening the market for PSPs in an integrated European market.

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Open-Bank Standards, an insight on the future of PSD2?

Open-Bank Standards, an insight on the future of PSD2?

The revised European directives PSD2 are causing major progress in the implementation of a Single Europe Payment Area (SEPA). It enhances the legal framework and facilitates competition and innovation on payment services market. The European Commission highlights that PSD2 brings security, safety and enables the possibility for new players to enter the market of new payment services.

Besides the action plan of European Commission, much more ambitious Standards are in construction in UK since the beginning of 90’ : The Open-bank Standards – an open-source API for bank that could definitely revolutionize the customer journey in retail banking. Is the Open-Bank Standards the destination of European payment services ?

Read the full white paper (pdf) "Open-Bank Standards, an insight on the future of PSD2?" by our consultant Mathieu Doyen.

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