Shibabrata to Disrupt Indian banking Equilibrium with his new “Neo Bank”

Shibabrata Bhaumik, popularly known as “Fintech Chanakya” the ex banker of Lloyds and Barclays and the founder of Fintech startup PayQ recently started its banking unit as PayqNeo. 

Though the neo-banking ecosystem in the country is already getting crowded, Shibabrata wants to engender unified experience through fintech skill and technological innovations which includes Artificial Intelligence (AI) and a superior mobile banking experience through an app or a website.

A neo-bank is a digital banking platform, which offers all basic banking services like account opening, credit, insurance and others, but without a branch-led model. 

Startups or Small Businesses with global customer outreach typically prefers to work with a Neobank as the account opening procedure is simple and less complex and you can use the banking services worldwide without any cross border hassle and dominion limitation.

Shibabrata’s UK start up PayQ aims to offer a wide range of services like faster account opening, mobile deposits, digital debit card, credit, digital payments and many more without the burden of a physical network.

The biggest challenge that PayQ might face is the hard-hitting directives by the Indian banking governing body RBI. Reserve Bank of India (RBI) doesn’t recognize digital banks, though they experiment with payment banks and small finance banks, these are not full-service digital banking platforms. India does not offer any neo-banking license unlike other countries like Singapore and Hong Kong. But NeoBank companies’ partner with banks, riding on their licenses, to create a digital banking experience for their consumers. 

That’s why Shibabrata kept the regulations of the company PayQ under the law of the United Kingdom, where EU régime is stress-free and banking partnership is rather simpler than in India. Therefore, PayQ Neo officially being headquartered in the United Kingdom can actually work with worldwide customers and acquire new banking relationships.

Neo Banks in India are rising but will take some time to disrupt. Neo Banks is expected to raise $394 bn by 2026. In India too, Neo Banks segment is scaling up and they raised $90 mn last year. Currently, 10 Neo Banks are operating in India along with PayQ and a few more are in the pipeline to begin their operations.

What is PayQ doing different from its predecessors and other Neo Bank Prototypes?

• BESIEGED CUSTOMER SEGMENT.

PayQNeo is proficient in easier customer acquisition- customers include tech savvy millenarian, Pursuing the Asian SME and MSE and low ticket salaried class, which are not the focus areas of legacy banks at the moment.

• TRUNCATED PRICING CUTTING

Lower costs, due to lack of physical branches and low capital investment, minimal staff and no additional operating cost.

• LOWER FEES/CHARGES AND EASIER CUSTOMER ACQUISITION.

As the cost of operations is trivial, the company can offer the cashbacks and offer much loftier than the traditional bank that operate within the obdurate limits.

• BORN IN THE CLOUD’ TECH PLATFORM

The chances of physical damage of the server is almost impossible as the data is backed up in cloud server and can be recalled into any system with secure nodes , with encryption technology.

• SPECIALISED BUSINESS BANKING SOLUTIONS 

With a whole array of services including payments, receivables, budget and spend management. Globally, the PayQNeo also operate in, credit cards, forex cards and payments, cash flow management and business banking services, expense management and loan products.