Banking services are shut down by Neobank Fi Money

Neobanking startup Fi Money has informed its customers that it will discontinue the banking services offered through its app in partnership with Federal Bank, marking a significant shift in the company’s business strategy.

In an email sent to users, the fintech company said the banking services available on the Fi app will soon be shut down. However, it clarified that customers’ savings accounts with Federal Bank will remain active and fully operational. The communication assured users that their funds are safe and can continue to be accessed directly through the bank.

Federal Bank also confirmed the development in a separate email to customers, stating that its partnership with Fi is ending as part of a broader business realignment. The Kerala-headquartered bank said customers can continue to manage their accounts using its official channels, including the FedMobile application.

Founded in 2019 by former Google Pay executives Sujith Narayanan and Sumit Gwalani, Fi Money had built a customer base of more than 3.5 million users through its digital banking platform. The startup has raised about $169 million in equity funding from investors including Peak XV Partners and Alpha Wave Capital, according to startup data platform Tracxn.

In recent weeks, some users had reported difficulties contacting the company’s customer support team and said they were relying mainly on email communication for updates and query resolution.

Earlier in February, Narayanan said the company was restructuring its operations and moving away from certain consumer-facing products. In a post on LinkedIn, he explained that the startup would instead focus more on artificial intelligence and enterprise technology solutions.

“As we realign, some products will be sunset, and thus a few roles are being impacted,” Narayanan wrote, noting that the changes were part of a broader restructuring effort rather than a reflection of employees’ performance. The company also laid off staff from some consumer-focused divisions over the past year.

He added that Fi would continue to invest in deep technology and explore opportunities at the intersection of artificial intelligence and business-to-business (B2B) services.

The development comes at a time when the neobanking sector is facing increasing challenges. Several startups in the space — including Jupiter, Open and Niyo — operate without independent banking licences and therefore depend on partnerships with traditional banks to offer regulated financial services. This dependency often limits their operational autonomy and the ability to innovate on new financial products.