“The High Street has been replaced by Amazon. The analogy is, what’s happened in banking is that the High Street banks have been replaced by the digital banks.”Anne Boden, CEO of Starling Bank, December 2020
Other terms: digital bank, digital-only bank, online bank, internet-only bank or virtual bank
Simple – the first U.S. neobank ever (mother of neobanking), founded in 2009 in New York, launched in July 2012 with 200’000 customers, and then acquired by BBVA USA in 2014 for US$117 million (accoring to different sources: with about 97’500 customers –> at a price of about US$1200 per customer; or with about 33’000 customers –> at a price of about US$ per US$3500 per customer).
During the three years after the acquisition, BBVA wrote down $89.5m for Simple, about 75% of its original acquisition price.
In January 2021, BBVA has informed its customers that Simple will be ceasing operations in 2021; the accounts will be transitioned to BBVA USA. This strategic decision was made as a result of the merger between BBVA USA and PNC Financial Services Group. The PNC has agreed to buy BBVA USA for US$11.6 billion with about 2.9M customers (estimation) (at a price of about US$ 4000 per customer). This comparison shows shows – depending on which source you rely – BBVA could multiply the value per customer than three times within the last 7 years or merely got the price per customer that BBVA paid in 2014.
Nubank Co-Founder Cristina Junqueira said the health crisis encouraged many Brazilians to jump into online banking for the first time, particularly to receive government stimulus payments.
Will 2021 be the year of consolidation in neobanking? After 5 – 6 years of explosive emergence of a new sector with a multitude of new competitors, consolidation sets in.
December 2020 – Nubank is poised to turn a profit, as is India’s Paytm, due to the pandemic-fueled demand for digital banking services.
Financial comparison of Monzo vs. Atom (February 2021)
Major challenger banks start to focus on profitability (January 2021)
Reflections on the Future of Swiss Banking (Daniel Fasnacht, April 2020)