The bank you open your next account with may not have a single branch. App-only banks are taking a growing share of new customers, and the biggest foreign players are on their way.

The numbers

Digital-only banks, often called neobanks, captured 40% of U.S. accounts opened in the past 12 months, according to Simon-Kucher's 2026 Global Neobanking Study, reported by Consulting.us on October 5. And 59% of U.S. consumers surveyed said they would consider starting a relationship with one.

The report singles out two foreign giants. Brazil's Nubank reported 131 million customers and $2.9 billion in 2025 net income. The UK's Revolut reported 80 million customers and $2.3 billion in pretax profit. Both won conditional approval for U.S. bank charters this year, as we covered in our look at fintechs becoming banks, and both are on track to operate as standalone U.S. banks in the first half of 2027, according to the report.

The report's advice for neobanks is simple: "They need to own one meaningful financial job, then use that relationship to win the next one," authors Christoph Stegmeier and Adam Drucker wrote.

The fraud problem

Growth has a cost. A PYMNTS Intelligence report, summarized by PYMNTS on October 7, found average fraud losses at neobanks, digital banks and fintechs rose from about $800,000 to $2.84 million per institution. Spending on fraud prevention more than quadrupled, to about $8 million.

Part of that reflects growth. Measured against the money they handle, the fraud-loss rate actually fell 20%, to 0.72 basis points, a fraction of a penny per $100.

The type of fraud is shifting, though. Scams in which a customer is tricked into sending money made up 22.4% of fraud dollars in 2026, up from 12% a year earlier. Account takeovers with stolen login details made up 28.2%. In other words, more than half of fraud now involves a real login or a manipulated customer, which is much harder for software to catch.

That matters for customers' trust. The same research found that 28% of consumers whose households lost money to a scam stopped using neobank accounts or used them less.

How a neobank differs from a bank

Not every app with "bank" in its marketing is a bank. Many neobanks are technology companies that partner with a chartered bank, which holds your deposits behind the scenes.

Deposit insurance can work differently. At a partner-bank setup, your money may be FDIC-insured through the partner bank, but only if the records showing which money is yours are kept correctly. When the middleman Synapse collapsed in 2024, many fintech customers lost access to their money for months while those records were sorted out.

Customer service is mostly in the app. That's fast for routine questions and frustrating when something goes wrong, like a frozen account or a disputed charge.

The pricing is often better. With no branches to pay for, neobanks often offer fewer fees and higher savings rates. For many customers, that's the big draw.

Why it matters

Competition from digital banks is pushing traditional banks to cut fees and improve their apps, which helps everyone. As Nubank and Revolut become full U.S. banks, that pressure will grow. But choosing an account now means checking the plumbing, not just the interest rate.

What you can do

Find the bank behind the app. Look in the fine print for "banking services provided by" and check that bank in the FDIC's BankFind tool.

Turn on every security feature, including app passcodes, biometrics and transaction alerts.

Test customer service before you need it. Send a simple question and see how quickly a real person answers.

Don't keep all your money in one place until you're comfortable with how an app handles problems.

What to watch

Watch the 2027 launches of Nubank and Revolut as full U.S. banks, and whether neobanks can slow the rise in scam losses.

Sources: Consulting.us on Simon-Kucher's study (Oct. 5) · PYMNTS (Oct. 7) · FDIC BankFind

Beyond the Bank is for informational purposes only and is not financial, legal, or investment advice.

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