Banking on Status

In the future, as issuing platforms become more mature and less expensive to experiment with, I anticipate you’ll see even more vertical neobanks. As the barrier to entry for issuing drops, you’ll see one of these from every company that has aggregated a captive segment of customers, and stands in their money flow.

Raph: "Tally the number of channel titles that mention or reference currency acquisition and wealth levels. It's clearly an extrinsic motivation architecture, at least in its messaging. Oh, I don't mean there is no organic element. But even the onramp is literally 'here's how to claim your play money.' It's framed around that."

When an industry, technology, or product area feels mature and "settled" (like online payments in 2009 with PayPal and many others, or email clients today), it doesn't mean that its a bad space to build something new. In fact, such inertia or perceived product maturity may be signs of a huge opportunity. In these cases, you should build from the id... See more

Vertical neobanks are an emerging flavor of embedded finance, that happen to be on the issuing side rather than the acquiring side. They offer a product with core financial benefits, that differentiate them from the majors (Chase, Wells, BofA, Citi).