Posted on

Looks like (some) neobanks will be OK after all


The fintech funding boom of the past several years saw huge amounts of capital flowing into so-called neobanks, digital financial companies offering banking services to markets general and niche.
The overarching idea behind the push made sense — many traditional banks are IRL-first and digital second, and their brick-and-mortar way of doing things engendered costs that were passed on to consumers. So why not build a new bank, a neobank, that uses tech to augment a meager staff, eschews buildings, and passes along savings to customers instead?
With the help of some existing banks’ regulation-ready systems, neobanks could spin up cheaply, and quickly begin collecting revenue — thanks to the power of interchange fees — in the form of small slices of customer spending. It was a pretty good idea, frankly, and like any such idea, attracted a host of fo …

Read More