UK neobanks have 20M customers despite growth slow

The research tracks the performance of UK neobanks compared to incumbent banks and traditional challenger banks

UK neobanks

UK neobanks have 20M customers despite growth slow. Source: unsplash.com

According to Accenture’s Digital Banking Tracker, UK neobanks gained 19.6 million customers worldwide by the end of 2019. The Tracker revealed that neobanks have nearly tripled their customer base in 2019, compared to 7.7 million customers in 2018.

Meanwhile, the traditional challenger banks demonstrated a 2% growth, whereas incumbents showed a 1% result. This way, the leading neobanks have surpassed the number of customers of many of the UK’s leading challenger banks.

At the same time, the customer growth rate fell from 170% to 150% in the first half of the year.

The research also unveiled that the average income per customer for neobanks increased to £9 in 2019, compared to £4 per in 2018.

Last year, neobanks in the UK lost between £5 and £15 per customer because of weak revenue streams and increased spend on customer acquisition.

The rapid growth of neobanks shows they have great consumer appeal, forcing their competitors to adapt and innovate, which can only be good for customers. But there are still stark challenges that need to be addressed as they try to close the massive gap between sky-high valuations and profitability. The elephant in the room for all banks is the impact Big Tech will have if it seriously enters the fold, which will likely shake up the sector in a way that will make the current fight for customers and deposit balances insignificant
Tom Merry, managing director at Accenture Strategy

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