Are neobanks fintechs? Most are, by origin, but not all fintechs are neobanks, and being a fintech says nothing about whether a company is a licensed bank. Fintech describes how a company uses technology; neobank describes an app-first account provider; “licensed bank” is a legal status. A single company can be all three, or only one or two.
Last reviewed: October 2026.
People often ask are neobanks fintechs or are they banks. The honest answer is that these labels measure different things. This article separates the three ideas, shows how real providers fit, and explains why the distinction matters for regulation and for the safety of your money. It is written for general readers in any country, with examples from the US, UK, Europe and Asia.
What “fintech” actually covers
To answer are neobanks fintechs, start with the wider term. Fintech means applying new technology to financial products and services. According to the Wikipedia overview of fintech, it spans mobile banking, online lending, digital payments, robo-advisors and crypto tools, and includes both startups and established banks that adopt new technology.
So fintech is a very wide category. It includes payment processors, lending marketplaces, budgeting apps, trading platforms, insurance technology and, as one subset, companies that offer everyday accounts through an app. That subset is what most people mean by neobanks.
Are neobanks fintechs? Where they fit inside the category
A neobank is a fintech business whose main product is a digital account experience: a card, transfers, saving and spending tools, with no branches. The partner-banking model, in which a technology company builds the customer experience on top of a licensed bank’s infrastructure, helped make this possible. The same Wikipedia article describes that model as paving the way for neobanks.
For the full definition and legal models, read what a neobank is. A comparison with another overlapping label is in neobank vs challenger bank.
Fintech versus bank: a legal difference, not a technology one
Whether a company is a bank depends on its licence. Four situations are common:
| Type | Example | Who holds your deposits |
|---|---|---|
| Fintech-born licensed bank | Revolut Bank UK Ltd, authorised by the PRA and regulated by the FCA and PRA | The bank itself |
| Fintech using partner banks | Chime, which states it is not a bank | Partner banks (Stride Bank and The Bancorp Bank, per its company profile) |
| Fintech that became a chartered bank | SoFi, conditionally approved by the OCC in January 2022 to form SoFi Bank, N.A. | The bank |
| Bank-owned digital brand | Openbank, Santander’s fully digital bank | The licensed bank |
Sources for the table: the Revolut UK explainer, the Chime profile, the OCC release on SoFi and Santander’s Openbank release.
Why asking are neobanks fintechs matters for your money
Deposit insurance and bank regulation attach to licensed banks, not to the word fintech. In the US, FDIC insurance only applies if a covered bank fails; it does not protect you if a non-bank fintech that sits in front of the bank fails. In the UK, the FSCS covers eligible deposits at authorised banks up to £120,000 per person per firm. Check our guides on FDIC insurance and neobanks and neobank regulation.
A fintech that is not a bank can still be regulated, for instance as a payment or e-money institution, but those rules usually focus on safeguarding customer funds and preventing financial crime, not on insuring deposits.
Regulators are tightening the model
Supervisors have also been clear that fintech status is no shield. Germany’s BaFin ordered stricter oversight of N26 in December 2025 after a 2024 special audit found serious deficiencies in risk and complaint management, according to MarketScreener. In the US, the California regulator and the CFPB took enforcement action against Chime in 2024 over complaint handling and delayed refunds, as summarised in the Chime profile above. These are examples of why you should look at the regulator and the specific entity, not the marketing.
Traditional banks are fintech users too
Established banks buy and build fintech themselves: mobile apps, instant payments, digital onboarding. Some run separate app-only brands. That blurs the picture further, which is why asking are neobanks fintechs “Is it a fintech?” is rarely the useful question. Better questions are who holds the money, who supervises that firm and what happens if it fails.
How to read a provider’s own description
Marketing pages are written to attract customers, so read the legal fine print too. Three phrases are particularly informative:
- “Banking services provided by…” This usually names a partner bank. Your deposits are held there, and any deposit insurance comes from that bank.
- “Authorised and regulated by…” This names a supervisor and often a registration number. Search the number on the supervisor’s own website, not through a link in the app.
- “E-money” or “payment institution”. This means the company is not a bank. Funds are normally safeguarded in segregated accounts, which is a different kind of protection from deposit insurance.
Revolut’s UK explainer shows how a single brand can change status over time. It says Revolut Bank UK Ltd moved from authorisation with restrictions in July 2024 to a fully authorised bank, that new customers now get FSCS-protected bank accounts, and that some existing accounts remain e-money accounts for now. Savings held with partner banks have their own separate protection. In other words, two customers of the same brand can have different protection depending on when and how they joined.
A short history of why the labels blurred
So, are neobanks fintechs that grew up, or banks that learned software? Both stories are true. Early fintechs avoided banking rules by working through licensed banks, an approach sometimes called renting a charter. Over time, some of the largest providers decided that owning a licence gave them more control over products, funding costs and customer protection, so they applied for bank licences or charters. At the same time, traditional banks launched digital-only brands. The result is that “fintech” and “bank” now describe overlapping groups rather than opposite ones.
That is why a single label cannot tell you how safe an account is. The practical approach is to check three facts for any provider: its legal entity, its licence or registration, and the place where your balance sits.
What this means for you
- Treat “fintech” as a description of the company’s technology focus, not a safety rating.
- Look for the legal name and licence in the app’s terms, then verify it on the official register (for example FDIC BankFind in the US, the FCA Register in the UK, or your national supervisor).
- If a partner bank is involved, note its name and confirm it is an insured or protected bank.
- Keep balances above the protection limit at more than one institution.
- Read how the provider treats non-deposit products such as investments, crypto or credit, which are often outside deposit protection.
A three-question test: are neobanks fintechs, banks or both?
Rather than debating labels, apply three questions to any provider. Each one isolates a different fact, and together they answer are neobanks fintechs, banks, or both for the specific app in front of you.
- Does the company deliver financial services mainly through its own technology? If yes, it is a fintech. Almost every neobank passes this test, and so do many traditional banks today.
- Is its main product an app-based account with a card and transfers? If yes, it is a neobank. A lending marketplace or a budgeting app fails here.
- Does it hold a banking licence in its own name? If yes, it is a bank. If a partner is named, the partner is the bank and the app is not.
Consequently, a provider can answer yes, yes, no, which is the typical US pattern, or yes, yes, yes, which is common among UK and EU leaders. Only the third answer changes your legal protection.
Worked example: one brand, three labels
Consider an invented provider called Northline. It started in 2019 as an app that issued cards through a partner bank. At that stage, the answer to are neobanks fintechs was simple for Northline: it was a fintech and a neobank but not a bank. In 2024 it obtained a banking licence for its home market. Its customers there became depositors of a licensed bank with full deposit protection. However, its customers in two other countries still bank through the original partner arrangement. Therefore, one brand now carries three different regulatory answers depending on where the customer lives and when they joined, exactly as the Revolut UK example above shows in real life.
What changes when a fintech becomes a bank
- Capital and liquidity. The company must hold its own regulatory capital and meet liquidity rules, which raises costs but lets it fund lending with deposits.
- Supervision. It answers directly to a banking supervisor, with regular reporting and inspections, instead of indirectly through a partner.
- Products. It can offer its own savings, overdrafts and loans without a partner’s approval, which is why licences often precede product launches.
- Customer protection. Deposits gain scheme protection in the bank’s own name, and recovery after a failure follows the standard bank process.
- Speed. Product changes may slow down, because every change now passes through compliance and risk functions required of a bank.
Common misconceptions about whether neobanks are fintechs
- Fintech means unregulated. Payment and e-money licences are real regulation; they simply do not include deposit insurance.
- Neobank and fintech are synonyms. Neobanks are a subset. Payment processors, robo-advisers and lending platforms are fintechs that are not neobanks.
- A bank cannot be a fintech. Many banks now describe themselves that way, and several run digital-only brands.
- The label on the website is the legal status. Only the regulator’s register is. Always check the entity name there.
For the full set of structural trade-offs, see our guide to the disadvantages of neobanks, and for a comparison with branchless licensed banks, neobank vs direct bank.
Sources and further reading
- Fintech (Wikipedia overview)
- Neobank (Wikipedia overview)
- Chime company profile (Wikipedia)
- Revolut: is Revolut a fully licensed bank in the UK
- OCC: conditional approval for SoFi Bank, N.A. (2022)
- Santander: Openbank in Germany
- Bank of England PRA: FSCS limit £120,000
- MarketScreener: BaFin and N26
Frequently asked questions
Are neobanks fintechs?
Most are, because they began as technology companies. Some neobanks are instead digital brands of traditional banks, so the answer depends on the company’s origin and structure.
Is every fintech a neobank?
No. Fintech includes payments, lending, investing, insurance technology and many other services. Only providers offering an app-first everyday account fit the neobank label.
Is a fintech the same as a bank?
No. A bank holds a banking licence. A fintech may be a bank, may partner with one, or may operate under a different licence such as e-money or payments.
Are fintech apps covered by FDIC insurance?
Only where your money is held in an insured bank account. The app itself is not insured, and FDIC insurance does not cover the failure of a non-bank fintech.
Can a fintech become a bank?
Yes. SoFi received conditional OCC approval in 2022 to form a national bank, and several others have pursued charters or licences. Approval comes with conditions and supervision.
Are fintechs regulated?
Yes, but how depends on the activity: banking, payments, lending, investment and crypto each have different rules and regulators. See our overview on neobank safety.
More questions on whether neobanks are fintechs
Why do some neobanks say they are not banks?
Because legally they are not. State regulators in California and Illinois reached agreements with Chime in 2021 about describing itself as a bank, according to its company profile. Look for the phrase naming the partner bank.
Is it risky to use a fintech that is not a bank?
It adds risk factors such as reliance on partners and different protections. Keep balances modest, understand where funds are held and consider a licensed bank for large savings.
Are neobanks fintechs in the eyes of regulators?
Regulators do not use either word as a legal category. They license banks, e-money institutions, payment institutions and similar entities. A neobank is regulated under whichever of those categories its legal entity holds.
Can a bank be a fintech?
Yes. Fintech describes the use of technology in financial services, and many established banks build or buy it. Some also run app-only brands that behave like neobanks while sitting under the parent bank’s licence.
Why do some neobanks insist they are not banks?
Because the law requires it. A company without a banking licence may not call itself a bank in most countries, so partner-based providers state that banking services come from a named licensed bank.
This article is general information, not financial advice. Products, licences and availability change, so check the provider and the relevant regulator or deposit-protection scheme before you open an account or move money.