The world is changing. Human behavior is changing. Banking is changing.

Across the globe, challenger banks, neo banks, virtual banks, digital banks are mushrooming rapidly chipping away market share from traditional banks. Offering the latest in innovation and access, these new financial entities are meeting the needs of niche market segments such as immigrants, freelancers, and independent contractors, women, and small businesses.

What makes these new financial upstarts’ in the face of incumbent banks is that they are feeling the heartbeat of people. They are challenging the “one-size-fits-all” model of big banks by offering specialized, focused products and services.

What sets challenger/neo banks apart from legacy banks is their inclusion of a social agenda as part of their business offering. It is key to their differentiation. Here is a mix of unique and cool Challenger/Neo banks that are disrupting the financial sector.

French financial startup Kard is a challenger bank that is focused on teens or generation Z whose 70% of transactions happen online, yet remain forgotten by traditional banks. Kard‘s mission is to allow teens with their own bank account, their own IBAN, and their own debit card. The aim is to empower a new generation of financially savvy consumers.

Another challenger bank focused on teens is AWSM. It provides full-service banking for teenagers with full parental control. AWSM mission is to provide financial literacy to adolescents and transform the banking process from generic, boring, and theoretical to personalized, practical, and experiential by providing teens with a real digital banking platform.

Zelf is a cheeky neo bank that is changing the rules of banking altogether. Zelf has no app and no physical card. It also has no “offboarding” — meaning users can’t withdraw funds once inside. Instead, users will be able to transfer money to other ‘Zelfers’ or shop via a virtual credit card which integrates with Apple Pay and Google Pay (allowing both online and offline shopping). Its UX and interface resembles a video game and is obviously directed to teens.

A cool challenger bank project is underway in Brazil. Elas, a Sao Paulo-based challenger bank specifically made for women, is laying the groundwork for launch in Brazil. Elas mission is to promote women in the business world.

Another interesting Brazilian digital bank is ConlifeConlife is a new Brazilian digital bank that evolved from being a telecom carrier. Conlife chose to expand its operations by leveraging its already built-in customer base. Using the Conlife app customers can carry-out financial transactions and top-up their cellular accounts using a single smartphone.

Stilt is a US challenger bank with a mission for helping immigrants that struggle to develop the credit history needed for student loans, rent an apartment or buy a car. Challenger banks Majority and Remitly were founded to serve the immigrant population, but their focused products are digital banking services rather than personal loans.

Nomo Banking is a new digital banking service, native to Spain, catering for freelancers and the self-employed. As of today, more than 40,000 freelancers throughout Spain. During the recent COVID-19 crisis Nomo has waived fees and presented hardship plans to its mainly small business customer base.

Picnic Bank, a UK start-up focused on ‘fintech for good’, is set to launch in September. Picnic will offer three account tiers. The first will be a gamified, ‘eco-concierge’ to inspire its customers to live greener lifestyles. The second will be a ‘fintech for good’ toolbox, with features such as overdraft alerts. The third account in Picnic Bank’s suite will be focused around debt rebuilding, specifically to help those loaded with student loan debt or debt due to losing a job.

By their very nature, challenger banks are pushing their incumbent competitors to be more agile, digital, and socially conscious.  They are growing exponentially, something which traditional banks had underestimated when they first entered the market. Created for the digital-first generation, challenger banks have won market share by putting customer-centric products at the heart of their business. They are also able to improve the product and the user experience quickly, listening to customers’ feedback.

The challenger bank phenomenon is not a fad or banking hiccup, it is a full-fledge banking revolution that is completely disrupting the market. Challenger banks will continue to leverage new technologies and new thinking to enable them to deliver new and faster mobile services entirely tailored to the needs of their customers.