Neobank

Neobanks offer many of the same services as traditional banks, such as current accounts, debit cards, savings, payments and sometimes loans, but customers manage everything through their phones or computers.

Without branches, neobanks usually have lower costs, which can mean lower fees, better exchange rates for travel or higher interest on savings. They often focus on user-friendly apps with features such as instant spending notifications, budgeting tools and quick account opening.

For example, a customer might open a neobank account in a few minutes using their phone and an identity document, and receive instant alerts every time they spend.

Some neobanks hold full banking licences, which means they can take deposits that are covered by deposit insurance. Others operate as technology companies in partnership with a licensed bank, which holds customers' money. Customers should check which arrangement applies, because it affects how their money is protected. Neobanks may also offer a narrower range of products, such as mortgages, than established banks.