Neo banks are globally referred to as 100% digital banks. They offer services ranging from accounts, credits and payments without the burden of a physical network. They are considered to be a sophisticated and nimble version of old-style banks. In India, regulations do not permit 100% digital banks. Payments banks had little success and the P2P lending platforms have too many restrictions and are yet to take off. Most Neo banks in India are just add on versions or the digital arms of established banks.

Recently, neo-banks have raised $90 million from venture funds, who look at neo banks as the best example of Fintech. However, this is a segment that is to prove itself in the Indian context.