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Top 12 Neobanks in India

Fintech innovations have allowed enhanced customer experience and satisfaction. Neobanks are gaining popularity across the globe as they provide the next level of convenience for their customers, for a better experience, unlike any traditional banking experience.

What are Neobanks?

Neobanks are fintech firms that function like banks and operate digitally – a collection of financial apps and services. Every transaction is done online and is entirely safe, customised, and more convenient in several aspects compared to traditional banks. Neobanks break old banking traditions such as cash deposits, bulky documentation, and personal interaction with a bank official.

The primary purpose of neobanking in the economy is to provide cutting-edge financial services and facilities through fintech and AI at a lower cost. It’s a gap that the current applications of traditional banks don’t fill!

There are no conventional brick-and-mortar branches of neobanks. Although not directly regulated by RBI, neobanks in India have banking partners such as ICICI, HDFC, and other banks which are registered with RBI.

What are the Benefits of Neobanks?

Here are some direct advantages of neobanks.

  • Digital and convenient banking services for bill payments, prepaid cards, money transfers, and savings account.

  • Highly personalised, convenient, flexible and user-friendly services.

  • 24×7 service available.

  • Easy to understand, user-friendly mobile app interface.

  • Access to financial management services.

  • Real-time notification and other transparent features in the neobanking structure.

  • Highly-secured features on apps and online platforms.

  • Alternative services at more affordable costs than traditional banks.

What are the Factors Behind the Rising Popularity of Neobanks in India & Worldwide?

Neobanks are getting immensely popular amongst gen-x. This is because neobanking is breaking all the stereotypical red tapes of banking through a technologically advanced digital system. They provide all the advanced financial services round the clock, quickly, and at lower costs.

For most people, these banks are convenient and hands-on as they are able to provide vital financial services at the touch of a fingertip.

So, basically it all comes down to convenience. India and the rest of the world are fast adapting to a digital lifestyle, and neobanks fit right into this lifestyle. Being able to bank without leaving your home or office makes it super convenient for our fast-paced life.

What are the Differences Between Neobanks, Digital (Challenger) Banks, and Traditional Banks?

The digital banks are similar to neobanks in terms of no physical presence. But their overall operating system is closer to traditional banks. You can understand more about the differences between neobanks vs traditional and digital banks through this table.

Criteria Neobanks Digital Bank Conventional Bank
Regulated by a Bank? Not regulated by banks
(they follow RBI and govt. regulation)
Regulated Regulated
Customer Support Online Online In-person, online
Banking License None/partial/full Partial Full
Service Platforms Web services and mobile apps Web services and mobile apps Physical establishment
Application Process Online Online In-person
Approval Process Quick Quick Manual and time-consuming

List of Top 12 Neobanks in India

Despite being a new banking system, neobanks have garnered a lot of popularity amongst individuals and commercial entities in India. Here are the top 12 neobanks of India that are excelling in terms of their services and the safety they provide to their users.

1. Freo Save

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Freo is the first credit-led neobank in India, offering smart and modern banking solutions to Indian and Southeast Asian millennials, giving them freedom from non-digital financial services. It provides a digital savings account called Freo Save, a flexible credit line called MoneyTap, a credit & EMI card called Freo Card, a buy-now-pay-later facility called Freo Pay, and Freo Utilities, which allows you to do more with Freo’s suite of financial utilities.

Freo provides 100% guaranteed security of your data and transaction reward points. It is one of the most promising neobanks, and is associated with brands like VISA, Equitas, NPCI, RBI, etc.

With Freo Save’s digital savings account, you can earn up to 7% interest.

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2. Fi Money

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Fi Money has the Federal Bank backing them. You can open multiple savings accounts with Fi Money, some with zero balance. They offer up to 5.1% interest on savings accounts but charge 1% of the interest rate for premature withdrawals.

You also get a Visa debit card if you have an account with Fi Money, and your account balance of up to ₹ 5 lakh is ensured.

3. Jupiter

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Jupiter is similar to Fi Money in terms of partnership with the Federal Bank. The process of opening a savings account with Jupiter is easy and fast. You get a detailed account statement and support system for any query you might have.

Jupiter offers zero balance facilities. They also give 1% reward points for debit cards and UPI transactions. Their automated savings mechanism, Pots, provides a 2.5% interest.

4. InstantPay

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InstantPay is one of the biggest neobank in India as it offers a banking platform to individuals and companies of all sizes and capacities. It processes numerous transactions per day. You can use InstantPay via its website or mobile application, whatever suits you.

It is known for instant account opening, cash deposits, active account tracking, and a 24*7 customer support system. InstantPay has partnerships with banks such as Axis Bank, ICICI Bank, Indusind Bank and Yes Bank.

5. 5. FamPay

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FamPay allows you to open an account in just a few minutes. It also offers a unique facility of virtual payment cards for online shopping, domestically and internationally.

In addition, their FamPay future is a fantastic initiative for the younger generation to learn more about finance by inviting them to debate and discuss financial systems and policies.

6. Mahila Money

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Sairee Chahal created Mahila Money in partnership with Capital Trade Links LTD, which is an NBFC (Non-Banking Financial Company). It is a neobank exclusively for female entrepreneurs from all walks of life.

It provides collateral-free loans without any guarantor at the interest rate of 20% per annum. It allows women to communicate with each other about their unique experiences regarding work or study.

7. Niyo

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Niyo has been around for five plus years now and has over 2.5 million happy customers. It offers several products and services to its customers with the motto of “making banking smarter, safer, and simpler.”

Niyo has been around for five plus years now and has over 2.5 million happy customers. It offers several products and services to its customers with the motto of “making banking smarter, safer, and simpler.”

8. RazorpayX

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Before being the one-stop shop for financial transactions in the digital ecosystem, RazorpayX was launched as an API and dashboard pay-out platform for merchants. Its software is customised for businesses to automate their payroll by scheduling invoices.

It also assists in deciding the credit limit of an enterprise. RazorpayX also performs tasks like limiting corporate expenses, automating tax payments, and granting urgent loans. Some of their well-known services are 20X limits, Smart pay-outs, and a business banking hub.

9. Chqbook

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The list of neobanks in India can’t be completed without Chqbook, the first neobank for small businesses. It aims to empower small business owners and budding entrepreneurs by offering personalised financial services and security.

Chqbook’s features include these five pillars:

  • Banking allowing current accounts
  • Rewards on transactions
  • Khata, a digital ledger service to track transactions
  • Insurance coverage
  • Loans with zero fee

10. ZikZuk

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ZikZuk works for the growth of SME founders. It offers founderscard, a credit card to founders with excellent credit scores. Reward points are also associated with founderscard transactions.

ZikZuk also offers contact banking to the founders to help manage their business finance and transactions. It also provides unsecured loans to entrepreneurs to help with their business funding.

11. Akudo

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Akudo is the first neobank in India focused on teaching economic freedom to the youth. It provides a prepaid card to teenagers under their parents’ watch. It also provides a system for families to control the spending of young teens to teach them the value of money.

Akudo means “peaceful wealth”, and it offers many reward points for saving to encourage this habit in the young generation.

12. Finin

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Finin is another neobank in India which works in the form of an app. It extensively uses AI technology for easy account opening and management of the account. It also offers insights to users to improve their finances. Open acquired it at the end of the year 2021.

It is expected that, apart from widening the reach of Open, Finin will also add value to Open’s band of SMEs.

Enjoy the perks that Freo brings you. Earn up to 7% interest by opening a zero balance account with Freo Save now!