5 new challenger banks with ultraspecific niches
People with Disabilities. Immigrants. People of color. Homosexual, lesbian or transgender people.
These are all groups of consumers who in some cases have felt under-served by their traditional institutions and have turned to neobanks that offer specialized savings accounts, debit rewards that are supposed to match their values, and service. empathetic customer.
” Often, [the founders] focus on what they know, ”said Sam Kilmer, chief fintech practice at Cornerstone Advisors. “It’s personal.”
Certain niches – including children and teenagers, couples, people of color, immigrants and small business owners – have each attracted a number of startups. Some companies stand out by targeting a portion of these populations, such as immigrants from a certain region (Cheese), newlyweds (Hitched), concert workers (Gig Money, Moves Financial) and freelancers (Lance, Lili).
Other neobanks are emerging to meet the needs of groups with little or no dedicated banking options. Founders who focus on a segment they know intimately have an advantage if they are realistic about the customer segment they will reach (accessible market), rather than the large audience that fits their neobank category ( addressable market).
“The narrower and smaller your niche, the less likely you are to meet competitors,” Kilmer said.
The following is a look at five neobanks that have surfaced in the past two years, their unique trends, and founders passionate about their target audiences.