Page 41 - Banking Finance February 2023

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lets a user carry out banking work around the clock, with fascination among millennial, it is still not being used
24*7 availability of access to banking functions. by large masses because of safety and security concerns.
One of the biggest drawbacks of traditional banking was As the differences in business operations, the business
the overly placed importance on paper. Banking has model of Neo-Banks too is quite different from that of
become paperless with the development of Neo- a traditional bank. Artificial intelligence with the help
Banking as a service. A user can log into their account of data analytics mainly drives the decision-making
at any point in time to monitor records. process.

Neo-Banking allows a user to set up automatic Data privacy is a significant concern for any institution
payments for regular utility bills such as electricity, gas, with technology at its helm. Given that Neo-Banks rely
phone, and credit cards. The customer no longer has heavily on customer data with the possibility of cross-
to make a conscious effort of remembering the due sell products staying afloat, failures and frauds is a cause
dates. The customer can opt for alerts on upcoming of concern.
payments and outstanding dues.
Prominent Neo-Banks:
Online shopping has become a cakewalk with payment
channels becoming well-integrated with the online
Name of the Services Rendered
shopping portals.
Neo-Bank
Neo-Banking can extend services to remote areas is
PayZello Uni Cards, Forex Cards, Loans, and
seemingly a step toward holistic development. With
Money Transfer, Account Opening,
smart phones at affordable prices and internet access
Virtual Debit Card, Expense
in remote areas, the rural population can make the
Management
most out of banking services.
InstaDApp Smart Contracts, Crypto Currencies,
Neo-Banking enabled fund transfers reduce the risk of and Other Block chain Assets Deposit
counterfeit currency. Account, Decentralized Asset Lending
By promoting a cashless society, Neo-Banking restricts and Borrowing
the circulation of black money as the Government can FinHealth Credit Payment, Banking, Payment
keep a track of fund movements. Solutions, and Remittance, Goal-Based
Savings, Consumer Durables, Gold,
Factors that may lead to failure of a Health Care, and Government
Neo-Bank? Benefits
Niyo Solutions Foreign Exchange Card with Savings
Regulatory and compliance factors can become primary
Account, Employee Benefits System,
reasons for Neo-Banks to not succeed in the financial
Travel loans and Early Salary Advance
space. For example, in India, the banking regulator RBI
has not yet granted a banking license to any Open Automated Account, Current
independent company to solely act like a bank without Account, Payment Gateway, Cash-
a branch. Flow Management, Tax, and
Compliance Management Solutions
The products offered by Neo-Banks are generally fewer.
Sometimes due to administrative complications, Neo- Razorpay X Payments, Current Accounts, Cheque
Banks are unable to offer mortgages and other lending Book, Credit Card, Payroll
facilities. Management, Customer Relationship
Management
Neo-Banks do not offer the core banking facility and
Walrus Payments, Savings, and Debit Cards
hence, HNI customers, who prefer to do business in
person are not attracted to this kind of bank. Forex-Kart Forex Services, Multi-Currency Foreign
Exchange Card, Traveler Cheques
While Neo-Bank has become a buzz word and a

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