How to start a Neobank app in 6 easy steps

Neobanks are transforming the way people manage money by offering faster, simpler, and more personalized financial services without physical branches.

For entrepreneurs and fintech startups, building a neobank is both an exciting opportunity and a complex challenge that involves regulations, technology, and user trust.

This guide walks you through the essential steps to start a neobank in 2025, from preparing the right requirements to launching and scaling your product successfully.

If you’d like to revisit what a fintech app is before diving into the steps of building your neobank, check out our guide “What is a fintch app“. It’s help you visualize how neobanks fit into the broader fintech landscape.

Requirements before starting a Neobank

Before jumping into product development, you need to ensure your business foundation is strong. Starting a neobank goes for beyond building an app. It means meeting strict legal, financial, and operational requirements from day one.

Licensing and regulatory compliance

Operating as a neobank requires compliance with financial regulations. Depending on your region, you may need to apply for a banking license or partner with a fully licensed institution to provide services like deposits, loans, or payments.

Understanding regulatory frameworks early on helps you define your business model and avoid costly legal hurdles later.

Funding and capital requirements

Building a neobank demands significant upfront capital, not only for technology and team development but also to satisfy liquidity and reserve requirements set by regulators. Ensure your financial plan covers both the launch phase and ongoing operational costs such as compliance, customer support, and security monitoring.

Strategic partnerships

Partnerships play a critical role in the neobank ecosystem.

If you are not applying for a full banking license, collaborating with a sponsor bank or fintech infrastructure provider is a practical option.

These partners can handle core banking services, compliance, or payment rails, allowing your team to focus on innovation and customer experience.

Risk management and security foundation

Trust is the cornerstone of digital banking. Establish a robust risk management framework that includes fraud prevention, KYC and AML processes, and data protection policies. Invest early in security infrastructure such as encryption, multi-factor authentication, and continuous monitoring to protect customer data and ensure compliance.

6 steps to build a neobank in 2025

It takes about 3 to 12+ months to build a neobank app from scratch, or rather its MVP version. The application development alone already accounts for 1600 hours, not to mention the time you need to acquire banking licenses and perform other activities. With that said, let’s go over the 6 steps you need to follow to build a neobank from start to finish.

Step 1: Research the neobanking landscape and identify your niche

Time frame: ~3 weeks

Jumping into build a neobank without understanding your market is one of the biggest mistakes new founders make. A lack of research often leads to poor product-market fit, wasted investment, and low adoption. That’s why your first step must be a deep exploration of the neobanking landscape and your target audience.

Your first mission is to find your niche. Look for gaps where your neobank can deliver clear value.

• Start by segmenting potential users. For example, low-income customers may need fast onboarding and zero fees, while SMEs and freelancers look for tools that simplify payments and cash flow. Pinpoint the specific pain points and habits of each segment.
• Then, evaluate competitors. Are existing neobank truly solving those pain points? If not, that’s your opportunity. Find gaps or frustrations and ask: what can we do better or differently?
• You want to offer what no one else can do or do better. It can be an advanced technology solution, a focus on ethical banking, or an excellent customer experience. However, make sure the USP aligns with what the demographic needs.   
• Finally, don’t forget to check regulatory constraints early on. Ensure your concept can comply with requirements such as GDPR, AML, or eKYC. You don’t want to design a brilliant app only to find it’s not legally viable.

Take Chime as an example. By targeting Gen Z and millennials frustrated with traditional banks, Chime built a no-fee, mobile-first neobank that quickly grew to over 22 million users. That clarity of focus is what drives sustainable growth.

Pro tip: Use tools like Google Trends, Statista, and CB Insights to expore demand and analyze competitors. Combine them with surveys or social listening tools (Brandwatch, Hootsuite) to uncover pain points traditional banks overlook.

Step 2: Secure regulatory approval and build a compliant foundation

Time frame: 1 – 2 months

After identifying your niche and understanding the market, the next challenge is ensuring your neobank can operate legally. Even with a great concept, without proper licensing, accounts can freeze, transactions can fail, and trust disappears instantly. Regulatory compliance is essential and forms the foundation of any successful neobank.

Once your legal path is clear, it’s time to build compliance into your processes:

• KYC / AML procedures to verify users and prevent fraud.
• Data protection aligned with GDPR or local privacy laws.
• eKYC & digital onboarding to make registration seamless.
• Transaction monitoring to catch unusual activity.
• Fund segregation & deposit insurance for customer protection.

Finally, establish credibility and trust:

• Partner with reputable financial institutions or fintech infrastructure providers.
• Communicate compliance measures clearly – transparency reassures users that their money and data are safe.

Why this matters: Today’s users expect instant, secure, digital-first experiences. Skipping compliance may seem faster, but it risks fines, lawsuits, and most importantly, the trust you need to grow.

Pro tip: Engage a fintech-focused legal advisor early and integrate compliance into your app design from the start. It’s far easier to build trust upfront than to fix mistakes later.

Step 3: Build an intuitive neobank app interface

Estimated time: 3 – 5 weeks

Once your legal and compliance foundations are in place, your neobank app becomes the face of your brand. A smooth, intuitive interface is key to gaining user trust and encouraging adoption. Users may forgive minor delays or bugs, but they will not tolerate a confusing or cumbersome experience.

The goal is to make banking simple, fast, and enjoyable. Focus on the core journeys first, then expand features based on user feedback. Key considerations include:

• User-centric design: Streamline onboarding, account management, and transactions so users can achieve their goals with minimal friction.
• Visual clarity and trust: Use consistent branding, clear calls-to-action, and visual cues that communicate security.
• Accessibility: Ensure the app works smoothly across devices, operating systems, and for users with disabilities.
• Early testing: Conduct usability tests and gather feedback from a small group of real users to identify friction points before launch.

Monzo’s spending dashboard and Revolut’s simple card management show how complex banking tasks can become effortless, allowing users to feel fully in control of their finances.

Pro tip: uild clickable prototypes and run small focus groups. Ask users if features solve real pain points or are just visually appealing. This helps prioritize what truly matters to your audience.

Step 4: Select a scalable and secure technology stack

Time frame: 2 – 4 weeks

The next priority is choosing a technology stack that ensures growth, security, and reliability. These tech decisions will determine whether your neobank app can handle more users, higher transaction volumes, and future features without compromising performance. If you want expert guidance, partnering with a neobank app development company can help select the right stack and implement best practices.

Start by focusing on scalability and security while keeping development efficient:

• Frontend technology: Use frameworks like React Native or Flutter for cross-platform performance and faster iteration.
• Backend architecture: Node.js, Python (Django/FastAPI), or Java ensure reliability and scalability.
• Database choices: PostgreSQL or MongoDB offer secure and consistent data storage.
• Security measures: Implement AES encryption, OAuth 2.0 authentication, biometric login, and real-time fraud monitoring. To dive deeper into how to strengthen your fintech security infrastructure, check out our guide on fintech app security.
• APIs and integrations: Connect with Open Banking APIs, payment gateways, and KYC/AML verification services to streamline operations.  

A modular architecture lets you add features like budgeting tools, investment dashboards, or even crypto wallets without rebuilding the system from scratch.

Choose technologies that balance speed of development with long-term maintainability. A robust stack ensures your neobank app not only launches successfully but scales safely as your user base grows.

Step 5: Launch a minimum viable neobank app and test thoroughly

Time frame: 4 – 6 weeks  

Launching your neobank app is the moment when preparation meets reality. At this stage, perfection is not the goal – delivering a minimum viable product (MVP) with essential features allows you to learn quickly from real users.

Focus on core functionalities first, such as account creation, balance checks, basic transactions, and compliance processes. Launch in small, iterative updates so you can respond to feedback rapidly and continuously improve the app.

Quality and security cannot be compromised. Conduct thorough penetration tests and audits to ensure data protection and regulatory compliance. Engage a small group of beta testers to uncover usability issues, friction points, and potential bugs before scaling.

Every interaction with your MVP provides valuable insights. Monitor user behavior, transaction flows, and feature usage to guide development priorities. Treat feedback as actionable data, refining the experience to build a trusted and user-friendly neobank app.

Step 6: Scale your neobank and optimize user experience

Estimated time: Ongoing

Launching your neobank is just the beginning. To grow successfully, you need to focus on continuous improvement, user satisfaction, and strategic expansion. Here’s how to scale effectively:

• Monitor key metrics: Track user retention, transaction volumes, and app stability to identify what works and what needs improvement.
• Enhance customer support: Provide responsive in-app assistance or chatbots to resolve user issues quickly and build trust.
• Expand features strategically: Introduce tools like budgeting, investment dashboards, or AI-driven financial insights to boost engagement.
• Form strategic partnerships: Collaborate with banks, fintech providers, and payment networks to accelerate growth and add value.
• Iterate constantly: Make small but consistent improvements in UX, security, and functionality to increase trust and retention.
• Use feedback as actionable insights: Treat every user comment, review, and behavioral metric as data to refine your product continuously.

Pro tip: Numbers don’t lie. As a neobank, you will collect a lot of data as your operations expand. Leverage it to find insights into your customers’ preferences and their needs. These can power the growth of your business.  

How much does it cost to start a neobank app?

Building a neobank app involves more than coding – it requires licensing, security, design, and infrastructure. Depending on your scope and location, the average development cost ranges from $80,000 to over $700,000, though complex, fully licensed neobanks can exceed $1 million. Here’s a breakdown based on different complexity levels:

Complexity	Features	Estimated cost (USD)
Basic (MVP)	– User registration & KYC – Check balance & transactions – Basic mobile UI – Admin dashboard	$80,000 – $150,000
Medium	– All MVP features – Budgeting tools & analytics – Push notifications – Virtual card support – API integrations	$150,000 – $300,000
Advanced	– All Medium features – Multi-currency wallets – AI-based insights – Crypto wallet support – Premium UI/UX – Cross-border payments	$300,000 – $700,000+

To optimize your budget:

• Consider white-label neobank solutions to cut time and cost.
• Partner with an experienced neobank app development company that already understands compliance, integrations, and scalability challenges.
• Start lean – focus on an MVP, test your concept, and scale features as you gain users.

It’s time to launch a Neobank

You’ve seen the roadmap, from defining your niche and securing licenses to designing a seamless app and implementing strong security layers. Now comes the exciting part: turning that vision into reality.

Building a neobank goes far beyond writing code. It requires deep understanding of financial regulations, smooth integration with third-party services, and a user experience that builds trust from the very first transaction. That’s why having the right development partner is so important.

At Synodus, we bring end-to-end expertise in fintech and neobank development, combining technical excellence with deep domain knowledge.

• Experienced team: Our developers and solution architects have built fintech products across payments, lending, and neobanking – ensuring compliance and scalability from day one.
• Faster go-to-market: With ready-made modules, API integrations, and even white-label neobank frameworks, we help startups reduce time to launch by up to 40%.
• Built for growth: Whether you start with an MVP or a full-scale platform, we design architectures that support future features like budgeting, crypto wallets, or investment dashboards.

Here’s one of our case studies of how we helped our client build a scalable Neobank platform.   

If you’re ready to take the next step, Synodus can be your trusted tech partner – guiding you from concept to compliant, scalable launch.

Wrapping up

That concludes our guide on how to start a neobank in 2025. We hope the 6-step instruction above has inspired confidence in navigating this new iteration of digital banking.  

All in all, building a neobank now is promising, but not easy. It requires careful planning, a deep understanding of market needs, and a strategic approach to technology and regulatory compliance. However, with the right dedication and a little help, you can transform users’ banking experiences and shape the future of neobanks.