Banking is booming!

Last Updated: 5. November 2023By

Simon-Kucher is a global consulting firm with over 2,000 employees in 30 countries worldwide and 37 years of experience. Recently, Simon-Kucher released an interesting analysis on neobanks. With dwindling financial resources, neobanks are increasingly under pressure. Instead of focusing exclusively on growth, they must now mainly focus on profitability. In the last 18 months, the number of neobank start-ups barely exceeded the number of closures. Nevertheless, both revenues and customer numbers continue to grow strongly.

The main neobanking developments at a glance: + Increased focus on growth and profitability for neobanks

+ Number of neobanking customers worldwide surpasses the billion mark

+ 40% revenue growth within 18 months

+ 20 neobanks with ten million or more customers

+ DACH region lags behind in international comparison and shows little growth

Profits at the end of the tunnel! A significant change is currently taking place in the neobanking sector. Instead of rapid growth, profitability is now the focus. This is the result of the current study „Profits at the end of the tunnel“ by the global consulting firm Simon-Kucher, which has intensively dealt with the dynamic industry.

At the same time, the number of new neobanks seems to be stagnating. In the last 18 months, 36 new neobanks were founded worldwide, but 34 were closed or acquired. Although the number of neobanks is hardly growing, the existing ones report strong customer influx and can finally increase their revenues significantly.

Growing revenues and customers Neobanks are becoming more and more popular. The number of customers has increased significantly and has now exceeded the billion mark worldwide. Around 1.1 billion customers are currently being served by neobanks. This corresponds to a growth of more than 30% in the last 18 months. Revenues are also rising significantly: The industry is experiencing a growth of over 40%.

The average revenues per customer also increased – from 69 USD to 75 USD – although there is a large spread between markets and banks. The experts from Simon-Kucher were able to determine that the market still offers much room for further growth. Now it is important to find and implement the right monetization strategy for the newly acquired customers.

Rise of the giants? Another dynamic development is emerging in the market: The 20 largest neobanks in the industry now serve more than ten million customers worldwide – another 20 serve more than five million customers. As a result, many of this group are now among the five or ten largest banks in their country.

Six neobanks are one step ahead of their competitors in terms of profitability. They combine a positive EBIT with above-average growth. However, in the DACH region (Germany, Austria, Switzerland) there are no such „Better Growth“ neobanks yet.

My conclusion: Neobanks are increasingly integrating cryptocurrencies! Neobanks are increasingly integrating blockchain services and services for cryptocurrencies.

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