The Australia Neobanking Market is expected to grow at a high CAGR during the forecasting period (2021-2028).
Australians changing their banking with advances in technology over time from branches to phone banking to online banking and now app-based banking.
According to Mozo’s research, the trend towards internet banking and app-based banking is clear, with roughly 75% of Australians now conducting the majority of their banking on a smartphone or computer.
Interestingly only 20% of those surveys reported doing the majority of their banking in a branch, while only 5% relied on phone banking.
For the majority of 18-24 years olds (43%) and 25-34 year-olds (40%) banking via an app on a smartphone is the method of choice, while those aged 35-44 (46%), 45-54 (49%), 55-64 (64%) and 65+ (67%) all did the majority of their banking via internet banking on a PC or smartphone.
The Neobanking market is valued at USD 46.50 million in 2018 and is estimated to grow at a CAGR of 40.43% over the forecast period to reach a USD 703.34 million by 2026.
Neo Banks holds a major share of around XX% of market share in 2018 and is expected to increase to XX% by 2026 in the global Neobanking market. Neo Banks are total digital banking platforms with no physical presence.
These banks provide provides a complete range of banking solutions to the customers.
Owing to the complete digital presence the cost of the operation is low and the banks can offer a better return on customer investment. The virtual presence and advance technological solutions such as Chatbots, self-servicing platforms, and digital investment options would increase Neo bank's adoption among customers at faster rates. Moreover, growing collaboration within payment platforms and neo banks would further propel the market growth for the global Neobanking market.
For instance, in May 2018, volt bank and Temenos T24 Core Banking and Analytics entered into a collaboration for the quick launch of its banking service.
The penetration of digital-only banks (Neobanks) in Australia is expected to be high in 2020. According to a recent study (Mozo’s Survey in October 2019), one in four banking customers have either already switched, or are seriously considering switching to a neobank. There are four major players in the Australia Neobank market such as 86 400, Up, Volt Bank, and Xinja. These four players stand apart from traditional banks, and even some of Australia’s online banks, in a couple of ways, but the chief distinction is that neobanks have digital front ends (their apps) and back ends, meaning that they’re not beholden to the same legacy systems as traditional banks. As of January 2020, each of Australia’s neobanks has at least one account available either to the general public or to early adopters, with even more products set to be rolled out in the near future. The banking products available from each neobank include:
86 400 - Own Home Loan, Own Home Loan (Fixed), Pay Account, Save Account Ø Up - Everyday Account, Saver Account
Volt Bank - Savings Account
Xinja - Bank Account, Stash
These banks are offering the best saving account interest rates in the country as compared to the major banks in the country such as ANZ, Commonwealth Bank, NAB, and Westpac
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