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The covid-19 pandemic had a significant effect on the economies of the region, however, the growth of the neo-banking market in the region accelerated during and after the pandemic. The demand for the online banking offered by the Neo banks rose significantly during the pandemic when people were confined to their homes due to lockdown and other restrictions.
Aside from the pandemic's contribution, neobanks' product offerings can also be linked to user growth. They've positioned themselves to provide financial products that will assist customers in achieving short-term financial objectives such as saving and stock trading. Furthermore, an enhanced regulatory environment might also be attributed to the market's significant client growth in the Asia-Pacific region. As the government displays concern to protect consumer funds, most authorities have a reputation for imposing severe rules. In addition, the region is recognized for having a primarily young population. Neobanks, in particular, appeal to younger, more tech-savvy consumers. Neo banking is ready for expansion in APAC, due to the large share of young people with expanding levels of disposable income, increased internet and mobile coverage, and a largely untapped market.
However, a lack of trust and reluctance to transfer to an unknown provider rather than the existing institutions that customers trust is a major impediment to converting to digital banks across the region. Furthermore, a large proportion of customers were either unaware of the existence of Neo banks or had no idea how they worked, which is a common trait for a Neo bank market in its early phases of development. However, 70% of Asia Pacific customers would at least consider a financial product offered by a non-finance source, with a preference for digital banking solutions offered by well-established shops, IT organizations, or telecommunications firms. Enabling costs have also been a substantial barrier to entry for customers in rural areas of the market. Because of the lack of infrastructure and high relative costs, a large segment of the population is unable to consider becoming digital bank adopters.
Scope of the Report
A neo bank is a digital bank with no physical locations. Neo banking operates solely online, rather than having a physical presence at a specific place. Neo banking is a broad term that encompasses a wide range of financial service providers who primarily target tech-savvy clientele. This report aims to provide a detailed analysis of the Asia-Pacific Neo banking Market. It focuses on the market dynamics, emerging trends in the segments, the future of markets, and insights on various drivers and restraints. Also, it analyses the key players and the competitive landscape in the market. Asia-Pacific Neo Banking Market can be segmented By Account Type, (Business Account, Saving Account), By Service(Mobile Banking, Payments, and Money Transfer, Loans, Others), By Application,(Enterprises, Personal, and Others), By Geography (China, India, Australia, Singapore, Hongkong, and the Rest of Asia-Pacific).
|By Account Type|
|Payments and Tranfer|
|Rest of Asia-Pacific|
Key Market Trends
Number of Customers for Neo Banking is Raising Significantly in the Region
Not only because of favorable demographics and supporting policies but also because of the development of tech giants and the expansion in payment-capable IoT devices and accompanying services, Asia Pacific has become one of the leading hotspots of the fintech revolution. According to Finbold data, neo banks in the APAC area added 134.8 million customers in 2021 H1, increasing the total number to 437.2 million, up 44.57 percent from the figure of 302.4 million in 2020. In 2019, there were 239.3 million customers in the region's neo banks. The number of new customers acquired by APAC neo banks increased by 113.62 percent between 2020 and 2021, from 63.1 million to 134.8 million. Between 2018 and 2019, there was a staggering 233 million new customers added to the neo banking market of the region.
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India is Leading in Terms of Number of Neo Banks Presence in the Region
There are currently 68 neo banks in Asia-Pacific. While this figure lags behind the European and US markets, it is simply a sign of a less developed sector that is likely to grow at a rapid pace once regulations are clearly defined. With 14, India is the leading country in terms of neo banks. Australia has also the largest number of neo banks in the region with 13 neo banks, while in Eastern Asia, Hong Kong has the biggest number of digital banks with 12. China, on the other hand, is home to only four neo banks, despite being the global leader in digital banking with 220 million neo bank customers. With the rise of neo banks in the region, a number of traditional banks have taken distinctive initiatives to further digitalize their goods and build appealing propositions targeted at retaining and attracting consumers.
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Currently, there are 68 Neo banks operating in the Asia-pacific market. Although the number is low compared to the developed neo banking market of Europe and America, the growth rate is high. A large number of players are entering making the market more competitive. India, Australia, and Hongkong have the highest number of Neo banks in the region. However, China has the single largest number of Neo bank Customers in the region. Some of the major players in the market include We Bank, Paytm, WeLab Bank, KakaoBank, My Bank, etc.
- In April 2022, WeLab Bank has become the first virtual bank in Hong Kong to be granted permission to provide digital wealth advising services. The Bank soft-launched its intelligent wealth solution GoWealth Digital Wealth Advisory (GoWealth) for selected customers after receiving Type 1 (Dealing in securities) and Type 4 (Advising on securities) licenses from the Hong Kong Securities and Futures Commission (HKSFC).
- In December 2021, Kakao Bank announced the signing of an MOU with Kyobo Life Insurance, Kyobo Bookstore, and Kyobo Securities for data cooperation and partnerships with other financial platform firms. Financial product planning and development, as well as cooperative marketing, will arise from a business relationship with Kyobo Life Insurance and Kyobo Securities.
Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS AND DYNAMICS
4.1 Market Overview
4.2 Market Driver
4.3 Market Restraints
4.4 Porters 5 Force Analysis
4.4.1 Threat of New Entrants
4.4.2 Bargaining Power of Buyers/Consumers
4.4.3 Bargaining Power of Suppliers
4.4.4 Threat of Substitute Products
4.4.5 Intensity of Competitive Rivalry
4.5 Insight on Technologial Adoption in the Market
4.6 Insight on Various Government Regulations in the Market
4.7 Impact of Covid 19 on market
5. MARKET SEGMENTATION
5.1 By Account Type
5.1.1 Business Account
5.1.2 Saving Account
5.2 By Service
5.2.1 Mobile Banking
5.2.2 Payments and Tranfer
5.3 By Application
5.4 By Geography
5.4.6 Rest of Asia-Pacific
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Market Concentration Overview
6.2 Company Profiles
6.2.3 WeLab Bank
6.2.4 Kakao Bank
6.2.8 Toss Bank
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
8. DISCLAIMER AND ABOUT US
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Frequently Asked Questions
What is the study period of this market?
The Asia-Pacific Neo Banking Market market is studied from 2018 - 2027.
What is the growth rate of Asia-Pacific Neo Banking Market?
The Asia-Pacific Neo Banking Market is growing at a CAGR of 8% over the next 5 years.
Who are the key players in Asia-Pacific Neo Banking Market?
WeBank, Paytm, WeLab Bank, kakaobank, MyBank are the major companies operating in Asia-Pacific Neo Banking Market.