The global neobank market is currently estimated at over 4.96 trillion dollars and is expected to reach 10.44 trillion dollars in transaction value by 2028. The size of the relevant neobank market is growing at an average annual growth rate of 47.3% between 2023 and 2032, according to a report by Natech Banking Solutions.
Greek banks have now understood that competition is rising with the opening of Snappi in Greece and the arrival of Revolut in 2026.
Worldwide, 27% of consumers cooperate with neobanks, the report stated based on recent statistics, with the number of their users worldwide increasing rapidly:
More specifically, they rose to 394 million in 2024 from 32.61 million in 2018, indicating the rapid adoption of digital banking services.
However, according to the report, adoption rates vary by region, with Europe and North America leading the way in penetration. The EU’s institutional framework has also favored countries such as the United Kingdom to lead the neobank sector, while Europe’s overall share of the global market stood at 38.32% in 2023.
Loss of customers
Losing part of the customer base is one of the main fears of traditional banks, as neobanks are expected to become their main competitors within the next five years.
In fact, according to the statistics reported by Natech, more than a third (35%) of European bank leaders understand that their innovation strategy is the creation of a new digital bank or fintech company, while 21% of European banks consider investments in technology as a strategic priority over the competition.
However, if a traditional bank continues to offer a problematic digital and non-personalized experience to its customer, this is one of the serious reasons that pushes customers towards neobanks. According to the report, globally, more than a tenth of banking leaders say they have lost 30%-40% of their existing customers due to their failure to adopt a customer-centric approach, while estimating that customer retention rates will fall by up to 20% following their failure to adequately adopt technological innovations.
Response
Under these competitive conditions, large European groups “responded” to the competition of classic neobanks and established neobanks themselves, seeking to exploit the growth prospects of digital banks. These are ABN, Bankiter, BBVA, BNP Paribas, Caixa Bank, Credit Agricole, ISP. LBG, Santander, SocGen, StanChart, a trend that, as UBS analysts reported in their recent report, is expected to continue this year.
In Greece, a typical example is Piraeus with Snappi. For the time being, of course, at the domestic level we have not seen a similar move from any other systemic bank, that is, a completely digital separate banking entity with international standards. What Greek banks do in response to competition is usually new applications that offer similar privileges to those of neobanks but are under the umbrella of the subsidiary bank. However, competition does not reject anything and it is not excluded that it will bring new initiatives in the near future.
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