Neo Bank startup FI has announced that it has raised $50 Mn in Series B funding round from B Capital Group, Falcon Edge and others. The Bengaluru based startup commanded a valuation of $315 Mn in the latest round. This is a seven fold increase in its valuation since the Series A that had transpired last year.
The company also announced that it has opened up its app’s access to all users. In the wake of this decision, FI’s users no longer have to be waitlisted and can directly download the FI app from the Google Play Store and App store.
FI is essentially a savings-friendly product that comes inclusive with zero balance saving account and offers slew of features to its users. The company also issues a debit card in partnership with Federal Bank.
Off late, Neo Banking has seen lot of traction, signifying investors’ growing interest in the this niche space. Neo Banking actually refers to teach savy and cheaper alternative to traditional banks. They are actually digital banks without any physical branches and offer new age services that are usually not by traditional banks.
Neo Banks essentially target today’s millennials and younger generation that thrives on internet and smartphone connections.
Along with Fi, Open, Jupiter and Niyo are some of the most well known and also among the most funded startups in the neo banking space. In fact, Open raised almost $100 Mn from Temasek, Google and other barely 3 weeks back.
According to Zion Market Research, the global neo banking industry is likely to grow at CAGR of 46.5% and its value is likely to reach at $394.6 Bn by 2026.
While the buzz around neo banking is certainly palpable, its long term success will also depend on its ability to cyber security solutions to its clients.