Vertical banking means offering a highly personalized banking experience to a very specific kind of customer. Where the usual approach is to enrich an existing banking product with technology, vertical banking does the opposite. The goal is to create a product that meets the unique needs of a well-defined audience.
Is building apps for the mass market and seeking growth at all costs still the key to success? Or is vertical banking – i.e. building a high-quality, but very focused product – the key?
If neo-banks are aiming to build customer loyalty and retention, they need to focus on creating innovative financial products that improve their customers’ lives through tailor-made solutions that traditional players are unable to offer.