Interview Claire Balva.
As part of our magazine, we've produced a series of interviews to illustrate our views and current trends in the financial and technology sector. Thanks to the opinions of experts, we aim to offer concrete perspectives and in-depth analyses to better understand this subject.
1. What do you see as the biggest challenges facing the cryptocurrency industry in achieving mass adoption?
Claire Balva : "The first challenge is technical. For years, the scalability of blockchains has been an issue. The preferred solution is to use overlay (layer 2) to process many off-chain transactions before reconciling them on the main blockchain, thus increasing network capacity and avoiding saturation and high costs, as observed during certain bullruns.
The second challenge is one of image. In manyn many countries, including France, cryptocurrencies are associated with illicit activities and ecological concerns. This poor image is detrimental to adoption.
Taking a step back, it's worth noting that the crypto industry isn't necessarily looking for mass adoption. Some currents, notably around Bitcoin and Monero, aim to serve as a backup in the event of failure of traditional monetary systems, rather than to achieve mass adoption."
2. How can companies prepare for and adapt to the constant innovations in cryptocurrencies and blockchain?
For traditional companies, I'd say there aren't really 50 options. As with any innovation, you need skilled people. So you need an innovation department that works hard. You also need some in-house technical skills.
The biggest obstacle is often a reputational and political one, because these are politically sensitive subjects. And the risk is to do what many banks have done over the last ten years, i.e. to do crypto without doing crypto, i.e. we're going to do blockchain without crypto. Many large companies avoid mentioning cryptos directly, preferring to use terms like blockchain or tokens. Overcoming these prejudices is crucial, but can be more difficult for a large company.
It's like AI, it's like the cloud. There's no magic formula: you need competent people and the necessary resources. For crypto companies, they don't have this stigma problem, but they do face challenges with funding and scaling due to strict regulations. For them, there's a real challenge of fund-raising and financing, as well as bank recruitment, legal recruitment and more traditional recruitment to comply with regulations...
3. What are the cultural and geographical differences in the adoption of neobanks in European countries and even worldwide?
To answer your question, perhaps what I can do is tell you about Deblock, and that will shed some light on the answer to these questions.
For example, the situation we're in today is that we're developing in France, before expanding to the rest of Europe. We have chosen to be regulated by the ACPR, which reports to the Banque de France, and is the French regulator. By being regulated by ACPRwe have the right to offer our services, for example, to the French overseas territories and French Polynesia, unlike other neobanks such as Revolut and N26.
When we arrived in Polynesia, we honestly didn't expect to receive many requests from Polynesians looking to open online bank accounts, as they only had access to traditional banks. They weren't necessarily looking for the crypto part, but wanted modern banking services.
In France alone, depending on whether you're in the country or not, you won't get the same offer. That's pretty important information to know.
4. What are the characteristics of typical neobank customers, and how do these institutions adapt their services to meet their needs?
Claire Balva: There's nothing revolutionary in what I'm about to say, but today's neobanks are aimed at a very wide audience, especially in France where people no longer need to go to a bank branch. For Deblock, we're targeting an audience familiar with cryptos, generally younger, who expect fast, fluid services available on mobile, with features like instant transfers . At last, these things have become indispensable services.
Demand for crypto offerings is growing, pushing even traditional banks to consider such options, despite internal reluctance. Commercial demand is forcing these institutions to evolve
5. What impact do neo-banks have on financial inclusion and access to banking services?
This has had a real impact, because in the end we had a banking sector that was a bit old-fashioned, with a sort of balance being struck between all the banks on bank charges. Neobanks reduce banking fees and simplify access to banking services, thereby promoting financial inclusion. They enable people, even in remote areas with Internet access, to open accounts without visiting a branch.
So yes, it does enable financial inclusion! Now, don't imagine that this is magic either. In some countries, or in remote areas, there is no Internet access, which is another challenge...
6. What are the future prospects for neo-banks and how might these banking institutions evolve in the future?
I can think of several things to say. First of all, it's important to realize that this is a sector in which there are questions about the profitability of the model. Fees are significantly reduced, but neobanks are trying to diversify their services, to offer a little more in the way of savings.
In fact, their cost structure is lighter than that of conventional banks, but they still have problems generating enough sales to be profitable. In terms of outlook, there's a real challenge for the neobank model to reach profitability thresholds that will enable us to be truly sustainable. It's actually quite important.
I think there's also a question of technological sovereignty. Because today, there are a host of neo-banks based on what we call Bank-as-a-Service (BaaS). They often depend on them, which makes them vulnerable to third-party infrastructures. Vou can have lots of different neobanks, but they're all based on the same infrastructure. For example: Deblock aims to be independent with its own payment systems to avoid this dependency.
In terms of outlook, I personally see a sort of clarification of the market to see which player is solid enough to be sovereign and not systematically dependent on an external infrastructure. With interest rates falling, neobanks also need to find ways of generating income, particularly through lending.
Then, again, I insist, I'm not an expert on the financial sector in general. My answer is perhaps a little diffuse.