The last decade has witnessed rapid developments in FinTech and neobanks, reshaping the global financial landscape. These changes have pushed the sector towards a more technology-driven future, raising questions about the role and relevance of traditional banks.
While FinTech, the integration of technology into financial services, has a long history, its modern wave, often referred to as FinTech 3.0, began after the 2008 global financial crisis. Public trust in conventional banking declined, paving the way for digital alternatives. The term “FinTech” saw a twenty-five-fold increase in usage, and investments surged, surpassing US$135.7 billion globally by 2019.
This growth was driven by several factors: the ubiquity of smartphones, regulatory initiatives like Open Banking, shifting customer preferences, and advances in kecerdasan buatan, machine learning, big data analytics and blockchain. FinTech evolved beyond simple functions like online payments to offer robo-advisors, peer-to- peer lending platforms and tools for personal finance management. Importantly, FinTech opened the door for financial inclusion, helping unbanked and underbanked populations access essential financial services.
Neobanks: Challengers in a digital era
Neobanks, also known as digital-only or challenger banks, have become prominent symbols of FinTech innovation. Though early versions appeared between 2009 and 2011, their global growth has been most notable since 2017. Between 2018 and 2020, the number of neobanks quadrupled, reaching nearly 300 worldwide by 2022.
Their market saw a compound annual growth rate exceeding 50% between 2016 and 2020.
Neobanks appeal to users through their fully online platforms, offering personalised and cost-efficient services via mobile apps. They focus on intuitive, user-friendly experiences that align with modern expectations. The COVID-19 pandemic further spurred their adoption, especially in regions where lockdowns increased reliance on digital banking.
Despite their rapid growth, neobanks face challenges. Building customer trust remains difficult, especially compared to traditional banks, which benefit from long-standing reputations and regulatory oversight. Profitability is another hurdle, as many neobanks have yet to develop sustainable business models. Some have shut down or merged with larger institutions. Traditional banks, recognising the competition, have responded by embracing digital transformation and launching their own digital- first brands or neobank subsidiaries.
Advancing financial inclusion
Financial inclusion has evolved from focusing solely on affordable services for low- income groups to ensuring access to a wide range of financial products for all. FinTech and neobanks play a central role in this transformation. Operating primarily online through apps, they offer flexibility, convenience and increased efficiency.
Technologies like AI, distributed ledger technology (DLT) and big data are helping financial institutions reach populations previously excluded from formal banking. FinTech allows users to carry out operations without visiting a physical branch, which extends services to remote areas. By lowering operational costs and bypassing infrastructure challenges, these services can reach more people at lower prices.
Islamic FinTech, for instance, is helping extend financial services in culturally and religiously sensitive ways. Users can now access products that align with Islamic financial principles from their mobile devices. These developments highlight the broader role FinTech can play in improving access to banking services for all.
Building trust in digital banking
Trust is critical for the adoption of digital banking. Many studies underline that a customer's willingness to use FinTech services is strongly linked to how secure and trustworthy they perceive those services to be.
The concept of trust is closely related to perceived risk—higher trust reduces,perceived risk and encourages adoption. Users are particularly concerned about the security of their personal data. If FinTech companies are not transparent about how data is collected, stored and used, users may be hesitant to engage with their platforms.
Technologies like biometric authentication (e.g., fingerprint and facial recognition) are increasingly integrated into apps to strengthen security. While these features offer a sense of safety, they also raise new concerns regarding privacy. Companies must ensure that users understand and trust the systems in place to protect their data.
Other factors also influence trust. Perceived ease of use (PEU) and perceived usefulness(PU) are critical. FinTech platforms that are intuitive, efficient and secure tend to be more trusted. Transparency, user education and clear communication about privacy policies can further enhance confidence.
The ongoing role of traditional banks
Despite the rise of FinTech and neobanks, traditional banks continue to play a key role. They benefit from regulatory frameworks, established reputations and extensive service offerings. While neobanks may excel in user experience, traditional banks still offer a comprehensive suite of financial products, from savings and loans to insurance and wealth management.
Traditional institutions have not remained static. Many have launched their own digital offerings or invested in FinTech startups. This response signals a shift from competition to collaboration. In some cases, partnerships between traditional banks and FinTech firms are creating hybrid models that combine innovation with stability.
From this perspective, the future seems to point not towards replacement but towards coexistence. Customers may choose services from multiple providers based on their needs, blending the convenience of digital tools with the security of established institutions.
FinTech’s global impact on inclusion
Around the world, FinTech is enabling access to financial services in areas where traditional banks have limited reach. Mobile wallets, payment apps, peer-to-peer lending platforms and crowdfunding are helping millions manage their finances without ever stepping into a bank.
In Asia, the Middle East and sub-Saharan Africa, mobile-only banks and digital wallets are serving underbanked populations. In India, FinTech companies are redesigning micro-financing for small businesses. These innovations demonstrate how technology can support inclusive growth and create more resilient financial ecosystems.
However, challenges remain. Infrastructure limitations, regulatory barriers and a lack of understanding of local cultures can hinder the reach of digital services. Additionally, building trust among first-time users continues to be a major concern. Addressing these issues will be crucial to expanding financial inclusion globally.
Reshaping not replacing
FinTech and neobanks have undoubtedly changed the face of banking. They offer speed, convenience and new models for financial inclusion. But they are unlikely to completely replace traditional banks.
Instead, a future of integration seems more probable. As customer expectations evolve, both traditional banks and FinTech firms will continue adapting—sometimes competing, sometimes collaborating. Each has its strengths, and together they can offer a more dynamic and inclusive financial system.
FinTech has revolutionised the way people interact with money. But the question remains: Can trust, regulation and innovation align to create a better banking experience for everyone?
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Referensi jurnal
Palos-Sanchez, P. R., Chang-Tam, R. J., & Folgado-Fernández, J. A. (2025). The Role of Neobanks and FinTech in Sustainable Finance and Technology. The Customer/User Perspective for Entrepreneurs. Sustainable Technology and Entrepreneurship, 100109. https://doi.org/10.1016/j.stae.2025.100109
