Neobanks in India : New Era of Banking in 2024, Get Benefits

Introduction and Overview: Neobanks in India

A Neobank is a digital online bank or a financial institution that does not have any physical branches. It provides banking services to customers through mobile apps or websites. Neobanks in India offers many of the same services as traditional banks, such as savings accounts, debit cards, loans, and money transfers. However, they often differentiate themselves by providing a more user-friendly and streamlined experience.

Since Neobanks don’t have physical branches, they can offer their services at lower costs compared to traditional banks. They may also provide additional features like automated savings tools, spending insights, and personalized financial management advice. Some Neobanks collaborate with traditional banks to ensure that customer deposits are insured and regulated by relevant financial authorities.

Neobanks in India

Top Neobanks in India

1.Freo

First Neobank in India which Provides simplify banking with user friendly app . Freo provide modern banking solution and also provides 100% guaranteed security of your data and transaction reward points. It is one of the most promising nonbanks, and is associated with brands like VISA,  NPCI and Partners of freo is HDB financial services, IDFC First bank, RBL Bank, Fullerton India, ACKO. Read More

Details are:

  • Established in 2016
  • More than 1 Million users and services in 1200+cities
  • Zero Balance Saving Account
  • 7% Saving Bank Interest Rate
  • Quick Access to credit line
  • Pay later facility
  • Financial utilities.
FREO
FREO

 

2. Jupiter

It Offers banking features like saving account, debit card and reward facility. One can avail the facility throuth its mobile apps. It has been partnered with Federal bank to offer banking products such as Savings Bank accounts, Fixed as well as Recurring Deposits to its customers. Go to Website

Details are:

  • Esteblished in 2019
  • Zero Balance Saving Account
  • No Hidden Charges
  • Withdrawal from any ATM
  • Earn Reward Points in real time
  • Mutual Funds, Digital Gold, Health Insurance.
jupiter
jupiter

 

3. RazorpayX

RazorpayX provides digital banking services to businesses and startups, offering current accounts, corporate cards, and automated payouts. Partnered by ICICI Bank , RBL Bank. Official Web

Details are:

  • Esteblished in 2013
  • Current Account With Attractive Features
  • Forex/FDI Transfer
  • Line of Credit
  • Corporate Cards
  • 24*7 supports
RazorpayX
RazorpayX

 

4. Kotak 811

Kotak Mahindra Bank offered its digital banking platform. The services like saving bank account, virtual debit card, funds transfer etc. For Details

Details are:

  • Esteblished in 2016
  • Zero Balance Saving Account
  • 4% Interest Rate
  • Free Lifetime Credit card
  • Virtual Debit card
  • Free Digital transaction like NEFT, RTGS, UPI
  • Rewards Points
kotak 811
kotak 811

 

5. Niyo

Niyo offers digital banking services, including salary accounts, prepaid cards, and personalized budgeting tools. Website Details

Details are:

  • Esteblished in 2015
  • 5 Million Users
  • Salary Account
  • Prepaid Cards
  • Expense Management
  • Forex Services
  • Investment Management
  • Insurance Services, Bill Payment

6. Fi money

Partnered with Federal bank to offer Savings Bank accounts, investment option, forex services etc. Read More

details are:

  • Esteblished in 2019
  • Zero Balance Salary/Saving Account
  • No Hidden Charges
  • No Minimum Balance Required
  • Withdrawal from any ATM
  • Zero Forex on select plans
  • Money insured upto 5Lac
  • Mutual Funds.
  • Instant Loan

7. Instantpay

It Provides Modern Business Banking Solutions Which Provides Smart Current Account with some unique features, it is a fast, flexible & transparent way to bank. Read more

Details are:

  • Esteblished in 2013
  • Smart Current Account
  • Salary Card
  • Loans/Overdraft
  • Collect Payment
  • Bulk Payment
  • Health and Accidental Insurance
  • 1Million+ Daily transaction and 1million+businesses

How Do Neobanks Works

Neo banks have a partnership with some or traditional banks, on the basis of which they are able to provide their banking services to the public. Their aim is to provide most of the banking services at home. Account opening, Saving Bank Account, Current Bank Account, Credit Card Facility, Instant Loan or Credit Line, Prepaid or Debit cards, Forex Services etc.

Customers can avail the services of Neo Bank by transferring or depositing money from any of their bank accounts to his Neo Bank. They charge negligible fees from the account holders. Since they do not have physical branches, because their infrastructure costs are coming down, they are able to earn a profit. Due to the availability of banking facilities sitting at home, these platforms are being used more.

Neobanks Legality in India

Neobanks typically obtain licenses as payment banks or small finance banks from the RBI or other authorities in India, allowing them to offer certain banking services. It is advisable for customers to review their licensing and regulatory status and understand the protection and services they offer. Safety of funds and personal information matters the most.

How to Access Neo Banks.

Through the Mobile App and Official website, One Can Avail the services of NeoBanks. Keysteps are:

  • Log into the Official Website or download the Mobile APP through playstore
  • Create or sign up the Account
  • Providing personal information with uploading some identity proof.
  • Complete the KYC
  • Start using the Facility.

Advantages and Benefits of NeoBanks in India

  • Banking at Home without any manual paperwork
  • Current Account facility available with startup businesses.
  • User Friendly, hassle free and flexible app with minimum or nil charges
  • 24*7 Service Available.
  • Easily money transfer, bill payment, recharge, UPI
  • Quick opening of account with zero maintenance charges.
  • Saving Account with Attracting interest rates.
  • Real time notification and other transparent features of financial services.
  • Forex/FDI Service available.
  • Quick International Payments
  • Instant Credit Line
  • Rewards points offering
  • Buy now pay later facility available.

Disadvantages of NeoBanks in India

  • No Physical Branches
  • Limited Services Only
  • They are not Banks
  • Security issues as its not properly licensed.
  • Risk of Cyber Attack and threat/hacking.
  • No Offline Customer Support and No Offline dispute resolution
How Neobanks are different from Traditional Banks

Neobanks are not fully licenced companies to provide banking facilities. They are considered as fintech companies in collaboration with traditional banks with the focus on providing modern banking facilities without going anywhere, whereas traditional banks are fully licensed by GOI / RBI under the Rules and Act. Find the Comparison :

Neobanks Vs Traditional Banks

Traditional Banks                                                     Neobanks

1.Provides various banking facilities                      1.Few banking facilities are available

2.Saving bank interest rates 3.5 to 5%                  2.Some nonbanks offer @7%

3.Manual Paperwork with online services             3.Only Online Services

4.Offline branches available across India              4.No Offline branch available.

5.Fully Regulated and Licensed by RBI                  5.Not Regulated or Partially Licensed

6.Manual Approval Process                                      6.Quick Approval process

7.Online and Offline Customer Support                7.Only Online Support 24*7

8.Nil Risk in terms of Data/privacy                          8.Risky in terms of cyber attack/data theft

Future of Neobanks in India

 Although Neobank in India is considered to be a new concept, the beginning of neobanks started in 2013, but with the growth of e-commerce or digital platforms, or increasing online transactions, neobanks spread fast globally. The future of Neobanks in India is looking promising as people are focusing on digital platforms, digital banking, paperless and hassle-free work.

Conclusion:

In summary, A Neobank is an online-based financial institution that provides banking services through mobile apps or websites, offering convenient and cost-effective solutions for everyday banking needs. The concept of Neobank is giving birth to the digital era as they are growing fast in India. It is advisable for customers to review all the details of Neobanks before using their services.

Frequently Asked Questions (FAQ)

First Neobank in India?

Freo Considered to be the first Neobank in India that provides smart banking solutions

Is neobank a new concept in India?

Most of us do not know about the neobanks concepts, while first neobanks has already esteblished in 2013. Now a days neobanks are getting popular.

Is neobank legal in India?

Neobanks have their official partner such as NBFCs or Traditional Banks, but then too their services are fully regulated.

Is your money safe with neobanks?

Most of Neobanks claimed that the money is insured upto 5lac, but then too it is suggested to go throught all the details before depositing money in neobanks as it is not fully licensed.

What is the future of Neobanks in India?

Promising Future of Neobanks in India. The Increasing Demand of digital banking, digital shopping, digital payment, Neobanks are growing fast.


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