The CEO Dialogue – India, the new hub of neobanks 2.0

Summary

India’s neobanking sector is rapidly evolving, positioning the country as a new hub for digital-first banking models. This report, 'The CEO Dialogue – India, the new hub of neobanks 2.0', explores the competitive landscape of neobanks in India, where over 30 digital banking platforms are redefining customer experiences and financial inclusion. The report examines the challenges faced by neobanks, such as the absence of formal digital-only banking licenses, regulatory uncertainty, and the ongoing struggle for profitability under revenue-sharing models with incumbent banks. It addresses critical questions: Can Indian neobanks achieve sustainability and profitability without a dedicated regulatory framework? How are traditional banks responding to digital disruption, and what strategies are neobanks adopting to differentiate themselves? The report also investigates the role of embedded finance and banking-as-a-service (BaaS) in supporting neobank growth, and how these platforms are leveraging technology, cloud infrastructure, and data monetisation to serve diverse customer segments, including MSMEs, women, and rural populations. Insights from industry leaders at Easy Pay, Freo, and LXME provide perspectives on customer acquisition, engagement, and retention, as well as the investment climate for neobanking startups. Readers will gain an understanding of the market drivers, regulatory developments, and future outlook for neobanks in India, along with the opportunities and hurdles shaping the next phase of digital banking innovation.