Back to Career News

RBI lens on neobanks amid rapid growth in customers

June 14, 2022

RBI lens on neobanks amid rapid growth in customers
The RBI is taking a tough have a look at the neobank enterprise mannequin the place fintechs plug into a traditional bank’s community and grow to be buyer-dealing with banking service suppliers. 

The concern is that the digital mannequin enterprise can scale up very quick and will develop to be larger than the underlying financial institution in phrases of customers. 

Although neobank customers proceed to be accountholders of the underlying financial institution, the one channel obtainable to those customers is the fintech-owned digital platform. 

There are over half a dozen moderately sized neobanks in the nation that are concentrating on a selected set of customers who don’t want to go to financial institution branches. Although these fintechs wouldn’t have a bankilicensence, they’ve a accomplice whose programs they plug into to supply fund switch companies to customers. These neobanks additionally supply branded debit playing cards. 

Currently, all of the regulatory recognition is the underlying financial institution, which has possession of all property and liabilities. The fintech’s enterprise mannequin is one of partnership, which has similarities to the white-label mannequin used in ATMs. While there’s a financial institution offering the connectivity, the investments are executed by the fintech, which additionally receives the income. 

Important Links:

Recommended for you ...

Indian Tech Startups Raise $1.6 Billion in Q1 2024, Retail and Fintech Lead Growth
Indian Tech Startups Raise $1.6 Billion in Q1 2024, Retail and Fintech Lead Growth

March 28, 2024

Fintech Experts Advocate for Cohesive Regulatory Framework Amid Rapid Digitalisation of Finance
Fintech Experts Advocate for Cohesive Regulatory Framework Amid Rapid Digitalisation of Finance

March 27, 2024

Indian Payment Aggregators Rush to Obtain International Payment Licences
Indian Payment Aggregators Rush to Obtain International Payment Licences

March 27, 2024

Chat on WhatsApp