The top 20 most valuable challenger banks

Amid the worldwide crisis and lockdowns created by the COVID-19 pandemic, leading digital banks seized an opportunity. Unlike traditional banks, digital banks did not have to retrofit their systems to support the remote delivery of banking services. Their architecture was already exactly suited to meet the needs of quarantined populations.

As customers around the world shifted to online banking, challenger banks set the bar for the kind of experience they could expect. By September 2020, more than 56% of Americans surveyed by Propeller Insights[a][b] said they were doing the majority of their banking on a tablet, computer, or smartphone. Nearly one in three (31%) said they were thinking of changing banks “right now.”

The shift in consumer attitudes has made it easier for challenger banks to attract new customers and boosted their value. According to Deloitte, challenger banks share six fundamental characteristics that enable them to disrupt the status quo.

• Digitally native customer base

• Evolving product offerings are centered on well-being and offered through scalable channels

• Emphasis on an emotional experience

• Rapid growth cycles

• Top talent models

• Reduced regulatory friction

To find out which banks benefited the most from the shift to online banking, we combined research from WhiteSight with press releases, public statements, and secondary sources such as Reuters, CNBC, Bloomberg, and The Information. We learned that the 20 largest challenger banks by valuation were worth more than $73 billion. Combined, they had a total of over 130 million users.