What is Challenger Bank Market?
Challenger banks are small and recently created retail banks with very few physical presences. Challenger banks mostly rely on digital technologies to provide their services and less on face-to-face services. Challenger banks are becoming more popular among consumers as it offers services at lower costs than a traditional bank. Further, the increasing use of the internet and the prevalence of smartphones have created significant opportunities for online banking that will accelerate the challenger bank market. The challenger banks are gaining more success in the niche market to address their specific banking needs.
Highlights from Challenger Bank Market Study
Attributes | Details |
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Study Period | 2017-2027 |
Base Year | 2021 |
Unit | Value (USD Million) |
Key Companies Profiled | Pockit (United Kingdom), Atom Bank (United Kingdom), N26 (Germany), Metro Bank (United Kingdom), OakNorth Bank (United Kingdom), Pennyworth Limited (United Kingdom), Monzo Bank Ltd (United Kingdom), Shawbrook Bank (United Kingdom), Starling Bank (United Kingdom), Tandem Money (United Kingdom), Fidor Group (Germany) and KOHO Financial Inc. (Canada) |
The companies are exploring the market by adopting mergers & acquisitions, expansions, investments, new service launches, and collaborations as their preferred strategies. The players are exploring new geographies through expansions and acquisitions to avail a competitive advantage through combined synergies. Research Analyst at AMA predicts that United Kingdom Players will contribute to the maximum growth of Global Challenger Bank market throughout the forecasted period.
Pockit (United Kingdom), Atom Bank (United Kingdom), N26 (Germany), Metro Bank (United Kingdom), OakNorth Bank (United Kingdom), Pennyworth Limited (United Kingdom), Monzo Bank Ltd (United Kingdom), Shawbrook Bank (United Kingdom), Starling Bank (United Kingdom), Tandem Money (United Kingdom), Fidor Group (Germany) and KOHO Financial Inc. (Canada) are some of the key players profiled in the study. Challenger Bank Market Segmentation:
Scope | Sub-Segments |
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Type | Own Banking License and Partnered With a Traditional Bank |
End Users | Personal,Enterprises |
Offerings | Investment Products,Insurance Products,Currency Exchange Services,Bill Payment Services,Mobile Cheque Depositing Services,Traditional Banking Products |
On the basis of geography, the market of Challenger Bank has been segmented into South America (Brazil, Argentina, Rest of South America), Asia Pacific (China, Japan, India, South Korea, Australia, Rest of Asia-Pacific), Europe (Germany, France, Italy, United Kingdom, Netherlands, Rest of Europe), MEA (Middle East, Africa), North America (United States, Canada, Mexico). Additionally, the rising demand from SMEs and various industry verticals gives enough cushion to market growth.
Influencing Trend:
Rise in Banking Super-Apps, Hyper-Personalization, and Integration of Advanced AI Analytics
Market Growth Drivers:
Customers’ Frustration with Traditional Banks and Prevalence of Digital Devices like Smartphones and Tablets, Growing Popularity of Digital Challenger Bank Among the People Due to Inclination Towards the Online Banking for Faster Service and Lower Service Offering Cost As Compared to Traditional Banks
Challenges:
Very Few Physical Branches and Lack of Protection by the Financial Services Compensation Scheme
Restraints:
No Overdraft Facilities and Limited Access to Business Loans Can Restraint the Market
Opportunities:
Significant Growth of Challenger Banks in the United Kingdom and the United States, Increased Adoption of New and Connected Technologies by Banks to Unlock New Financial and Non-Financial Opportunities and Increasing Operation in the Niche Markets to Addressing Their Needs
Key Target Audience
New Entrants/Investors, Analysts and Strategic Business Planners, Challenger Bank Providers, Venture Capitalists and Private Equity Firms, Government Bodies and Research Organizations, End-users and Others