Cross-border payment and FX fintech firm Neo is celebrating profitability – as an increasing number of SMEs explore alternatives to banks to manage their international business needs.
The Barcelona-based fintech provides a one-stop-shop multi-currency account for corporate treasurers and recorded an annual revenue of over €5million and an annual profit of €1million. Neo also saw cleared volume double in just under a year, reaching over €7billion in 2023 alone, highlighting the growing demand from businesses for alternative banking options.
Neo research highlights that when working with traditional banks, SMEs with international operations suffer from unfair pricing, slow execution and difficulties in reporting transactions. As a result, 92 per cent of SMEs are having conversations about virtual account solutions such as digital wallets to help solve these problems.
An increased bank diversification drive since the banking crisis which highlighted the risks of relying on one or two banking partners has also prompted company treasurers to diversify their banking pools and look to fintech providers as an alternative.
These factors have helped Neo acquire new clients and receive an increasing number of enquiries from corporates that are doing more business abroad and are looking to move away from their traditional banking providers.
Neo has been able to help businesses through its multi-currency account. It offers International Bank Account Numbers (IBAN) through which businesses can send and receive payments in 25 currencies. Neo’s wallet architecture also makes it easy for firms to organise their funds and store multiple currencies, ready for making rapid payments or exchanging currencies, revolutionising the way they transact.
Standing out against VC-backed fintech players
Laurent Descout, co-founder and CEO of Neo, said: “When we founded Neo, we knew that businesses were being underserved by treasury management software and banks which was holding back their international aspirations.
“So, we built a solution using our own proprietary software which simplifies cross-border payments, FX and treasury, giving them everything they need to expand internationally, all in one place. Our solution comes with a top-class support team that helps clients on a daily basis and offers a level of service that banks have failed to provide for too long.
“Over the past year, we have experienced exponential growth across our customer base, volumes and revenues which is a testament to the product and team we have built. Turning Neo into a profitable fintech was our main objective for 2023 and achieving this just three years after the launch of our multi-currency accounts positions Neo as a sustainable business.
“This helps us stand out against some VC-backed fintech players which have struggled with a lack of profitability. This is a very positive message for our shareholders, clients, supervisors and banking partners. Being financially independent will help us continue to grow our success and enhance our offering as we rebuild corporate finance from the ground up.”
Neo now works with more than 300 corporates across 28 countries – with more than 8,000 banks connected to its Bank Identification Code (BIC) on the SWIFT network.