The demand for challenger banks has surged in recent years, a phenomenon mainly triggered by the pandemic when consumers increasingly embraced digital solutions. With the global economy attempting to return to normalcy, the appetite for digital banks appears to be increasing, with more operators joining the market despite the prevailing macroeconomic factors that threaten the foundation of such platforms.
In particular, data acquired by Finbold indicates that as of October 2022, Europe was home to 97 challenger banks, the highest number worldwide, representing a growth of 27.63% from 76 recorded in October 2021. Elsewhere, North America and South America accounted for 73 and 57 challenger banks, respectively, a 15.87% increase.
The Asia-Pacific region has 47 banks, while the Middle East and Africa accounted for the least share of challenger banks at 17 although the region recorded the highest annual growth at 30.76%. Cumulatively, as of October 2022, there were 291 challenger banks globally. The figure represents an addition of 43 new digital banks or a growth of 17.33% from a similar period last year.