Report: OakNorth and N26 Have Received the Most Funding Out of All US and European Digital Banks

Digital-only banks, or neo-banks, are not dependent on outdated, legacy financial infrastructure. These virtual banks are more efficient than traditional banking institutions because they operate without the costly networks of physical branches.

Neobanks have been working towards transforming the retail banking sector in major financial markets throughout the world.

According to Crunchbase data, OakNorth ($1 billion) and N26 ($670 million) have received the most funding out of all other major US and European neobanks.

Other top European and American digital banks include Atom bank, Revolut, Monzo, Chime, Starling Bank, Varo Money, and Aspiration. These digital-only financial services providers have benefited from an innovation-friendly regulatory environment and have picked up significant momentum in Europe during the past three years.

Several European digital banks are already entering the US market leveraging the experience generated by operating in continental Europe and the UK.

Although many of the relatively older digital banks are based in the US, which includes Simple (launched in 2009) and Moven (established in 2011), the American digital bank ecosystem has not made as many advancements as Europe’s digital-only banks. This is largely due to a convoluted regulatory regime.

In the UK, one of the most robust Fintech markets, regulations are relatively streamlined. Digital banks have been encouraged to compete with traditional brick and mortar banks.

The US, by comparison, possesses a stultifying regulatory approach that makes it exceptionally difficult to receive a federal bank charter. Few digital banks possess a federal banking charter. Lobbying by traditional financial services firms have also slowed the development of digital banks.

Agile Fintechs have learned to adapt and today most US-based digital banks partner with a chartered bank to provide bank-like services.

Consumers, particularly the younger generation, have become increasingly frustrated with traditional banking services providers. Millennials are also more eager, or inclined, to consider using digital solutions, which may lead to more people using digital banks in the future.

There are many reports that have been prepared (including Business Insider’s Evolution of the US Neobank market) to address questions related to how digital banks and other modern Fintech firms are planning to establish their operations in the world’s financial markets.

N26 Milestone: Digital Bank Now Has More Than 1 Million Customers in France

Digital-only bank platform N26 announced this week it now has more than one million customers in France. The banking group reported it launched its services in the country less than three years ago with a goal to become the first bank that the French “like to use.”

At the time, 30,000 people had already joined our waiting list to be among the first to discover a new banking experience, with no paperwork and no hidden fees. And today, we’re proud to announce that we now have more than 1 million customers in France.”

N26 then revealed that since its launch in France it has implemented other services and features such as N26 Credit, in partnership with Younited Credit. N26 also revealed that it has integrated 3D Secure technology to provide extra secure transactions, launched discreet mode to let customers access their account in complete confidentiality when in public places, enabled Two-Factor authentication, and mobile payments.

N26 shared that 51% of its customers connect to their N26 mobile app from an iOS phone and 49% from an Android device. All age groups are represented:

  • 25% are between the ages of 18 and 25.
  • 37% are between the ages of 25 and 35.
  • 38% are over 35 years old.

N26 then added:

“The fact that N26 has now exceeded 1 million customers in France is all thanks to you! We are incredibly proud of this tremendous milestone and are grateful to you for continuing to bank with us, as well as for supporting us in building the bank that the world loves to use.”

The milestone in France comes less than two months after N26 announced it has made its mobile banking app available to U.S. consumers nationwide. U.S. residents may now download the app and apply for an N26 account and Visa debit card in five minutes. Nicolas Kopp, U.S. CEO of N26, stated at the time:

“We are excited to now open up N26 to the millions of US consumers who are frustrated with their current banking experience. We give users a banking app and Visa debit card that matches their lifestyles. We created a mobile, fast and easy way to bank.”

N26 Moves Out of Beta & Fully Launches to U.S. Consumers

Less than a month after it opened its platform in the U.S., digital-only banking group N26 announced it has made its mobile banking app available to U.S. consumers nationwide. Starting today, U.S. residents may now download the app and apply for an N26 account and Visa debit card in five minutes.

Speaking about the official launch, Nicolas Kopp, U.S. CEO of N26, stated:

“We are excited to now open up N26 to the millions of US consumers who are frustrated with their current banking experience. We give users a banking app and Visa debit card that matches their lifestyles. We created a mobile, fast and easy way to bank.”

N26 also noted that its customers will benefit from up to 10% off the cost of select monthly subscriptions when paying with their N26 card. Current subscriptions include health and fitness app Aaptiv, micro-learning reading app Blinkist, podcast platform Luminary, and global music and entertainment streaming platform TIDAL.

The banking group further explained the release of its peer-to-peer payment service MoneyBeam. Customers can now use MoneyBeam to send and receive money from their friends, family, and anyone in their smartphone contact lists who also has an active U.S. N26 account. Funds are transferred instantly between US N26 users and make sharing expenses, such as a restaurant bill, fast and easy.

As previously reported, N26 currently has more than 3.5 million customers in 25 markets across Europe holding over €1 billion in accounts and generating over €2 billion in monthly transaction volume. The bank has secured $670 million, gaining a $3.5 billion valuation, as it builds out its banking services across Europe. N26 claims to be “the first bank you will ever love.”

Future Fintech: The Fight for the Digital Banking Crown

As 2019 moves into its third quarter, the once burgeoning industry of digital banking is starting to make serious waves in the financial world – and investors are taking notice. Big players like Monzo, Starling, N26, Revolut, and EQIBank have recently completed massive funding rounds supported by a range of VC’s and angel investors from around the world.

UK-based Monzo has been making headlines lately with a £2 billion valuation following a £113 million funding round led by startup accelerators Y Combinator and Latitude. Despite lacking some of the advanced features and alternative asset investment options, it now presents serious competition to its closest rival, Revolut.

Monzo announced in June that it plans to roll out its services into the USA, where it faces stiff competition from tech startups like Wirex, Varo Money, Chime, EQIBank, N26, Aspiration and more. P2P lender Zopa has long messaged its intent to transition into a digital bank. US-based marketplace lender LendingClub revealed earlier this month its intent to pursue a banking charter thus throwing its hat into the ring of digital-only banking operations.

Since its launch in 2015, Monzo has already amassed over 2 million users and has drawn the attention of Instagram founder Kevin Systrom and musician Tom Odell.

Fellow UK-based digital banking startup Starling Bank has flexed its muscle in the sector, having secured £75 million in a funding round earlier this year led by Merian Global Investors. The move brought its total valuation to over £120 million and solidified the bank’s plans to expand into Europe later this year.

European newcomer N26 dominated the global digital banking scene in 2018, being named the number one tech startup in Germany by Linkedin. It powered its way into 2019 by raising a whopping $300 million in its Series D funding round, bringing its total valuation to $3.5 billion. New investors to the N26 table include the New York firm Insight Venture Partners and Singapore-based GIC.

Bringing Custody Solutions to the Table

Since its inception in 2016, fresh tech startup EQIBank has forged ahead with a wealth of new features, including multi-layer custody storage for alternative assets. The strategic relationship, formed with trusted South Dakota-based custody solutions provider Kingdom Trust, makes the firm a leader in digital asset insurance. As of this month, EQIBank customers can now enjoy up to $50 million in digital asset insurance.

“We’re proud of our growing operational and technology relationships, of which Kingdom Trust is a welcomed addition. Our job is to give EQIBank’s clients the ability to protect their future,” said EQIBank CEO Jason Blick. “We think about the things they need before they know they need them. Strong, insured custody is one of those things.”

California-based Aspiration has been around since 2013. Following a $47 million investment round in 2017, the firm launched a new $200 million fundraising round in April this year in hopes of pushing its valuation past $1 billion.

With over 1 million investors, the firm benefits from backing from famous Hollywood actors Leonardo DiCaprio and Orlando Bloom and focuses on providing more ethical and social banking services to those in need.

Far from the struggling tech startups of the early 2010s, online digital banks now represent serious competition to the traditional banking sector. With lower fees, faster transactions, digital asset support, and increasingly comprehensive custody solutions, the big banks have no choice but to sit up and take notice.


Aubrey Hansen is a freelance writer, a graduate of Aarhus University and crypto enthusiast. She writes about blockchain technology, Fintech, and cryptocurrencies.  She’s been researching major developments in the crypto world in the past couple of years.

N26 Digital Bank Invites Start Rolling Out to US Customers

Digital-only bank N26 has opened up its platform to US customers and is sending out invites to download the App and receive an N26 card now.

N26, based in Germany, is one of a group of European digital banks crossing the Atlantic to provide services in the US.

N26 has raised $670 million, gaining a $3.5 billion valuation, as it builds out its banking services across Europe. Founded in 2013 and launched in early 2015, N26 currently has more than 3.5 million customers in 25 markets across Europe holding over €1 billion in accounts and generating over €2 billion in monthly transaction volume.

As the US regulatory environment for becoming a bank is rather convoluted, N26 has partnered with Axos Bank to provide their services.

N26 claims to be “the first bank you will ever love.”

Crowdfund Insider will keep you posted.

N26 Extends Series D Funding Round to $470 Million; Now Valued at $3.5 Billion

N26, a European digital-only bank, announced on Thursday a $170 million extension of its Series D funding round to $470 million. N26 reported that the extension drives the bank’s valuation to $3.5 billion, claim it to be the highest valued German startup. To date, N26 has raised more than $670 million.

N26 also revealed all previous investors from the Series D funding round in January 2019 extended their investment in the company. Among the participants include Insight Venture Partners, GIC (Singapore’s sovereign wealth fund), Tencent, Allianz X, Peter Thiel’s Valar Ventures, Earlybird Venture Capital, and Greyhound Capital. N26 Co-Founder, Maximilian Tayenthal, further stated:

“Once again, our investors have placed their trust in us. This will allow us to accelerate our global expansion outside Europe. The further increase in valuation is a great testament to the company’s development over the last months.”

Founded in 2013 and launched in early 2015, N26 shared that it has more than 3.5 million customers in 25 markets across Europe who currently holds over €1 billion in accounts and generate over €2 billion in monthly transaction volume.

N26 is planning to use the additional funds to drive expansion in Europe, the U.S., and Brazil. The company will also invest in innovative new features. The extension comes just one week after N26 announced its launch in the U.S. N26 claims to be the first continental European challenger banking platform to launch in the U.S. and is working with Axos Bank to offer FDIC insured accounts as well as a debit card.

N26 currently operates in the following countries: Austria, Belgium, Denmark, Estonia, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden, the UK, and the US.

Varo Money Inches Closer to Becoming First True Digital Only Bank in the US

Varo Money has been in operations for years now providing banking services in a digital only environment to a growing number of consumers. Like all other US-based aspiring digital banks, Varo has had to leverage regulatory arbitrage to provide its services by partnering with another entity that operates with a federal banking license.

While the US may be host to thousands of banks, both large and small, creating a diverse group of community banks and money center operations, the country also struggles underneath one of the most antiquated regulatory environments in the world. Between the many different federal regulators that touch finance, banks must also adhere to state rules in any jurisdiction they operate. This has created an effective regulatory moat that Fintechs must cross to challenge traditional banks. The regulatory morass has clearly undermined competition. But Varo is now expected to be the first digital operation to be able to separate from a bank-licensed partner and challenge old finance on its own.

In August of 2018, Varo Money finally received conditional approval for a De Novo Bank Charter from the Office of the Comptroller of the Currency (OCC). In its approval, the OCC stated:

“The proposed Bank will be a full-service bank with a nationwide footprint. The Bank’s proposed business model combines a traditional retail banking approach with modern technology. The Bank proposes to offer banking products through mobile, online, and phone-based banking channels and intends to include traditional loan and deposit products.”

Final approval will be granted to Varo Money once it receives Federal Reserve membership and Federal Deposit Insurance Corporation (FDIC) deposit insurance – which backs each individual account for up to $250,000 thus providing confidence in FDIC approved bank.

According to a report in BI this week, Varo Money applied for FDIC insurance this past Monday.

Founded by CEO Colin Walsh, Varo Money was launched to bring banking into the digital future. Speaking with Crowdfund Insider several years ago, Walsh noted that traditional banks, on average, dedicate $0.60 of every dollar of revenue to maintaining overhead: employees, branches, old systems.

“Their scale and complexity has made their operations prohibitively expensive,” said Walsh.

Therein lies the opportunity.

By removing legacy cost, antiquated IT systems and physical locations, Varo Money can provide superior services to consumers at a lower cost. Varo has raised over $170 million in venture funding to accomplish their mission.

Varo Money expects to top over 750,000 customers this month – a number that is said to be growing rapidly.

While Varo may be the first licensed digital bank in the US, it will not be alone for the hearts and wallets of consumers.

Other domestic offerings such as Chime, and bank-like Fintechs such as SoFi, are providing many of the banking services customers need. Additionally, there is a growing movement from European challenger banks to cross the Atlantic and set up operations to compete with banks such as Varo as well as old-guard traditional banks.

Earlier this month, N26 – a digital bank founded in Germany in 2013 but now available across Europe, opened up to a waitlist of US customers said to be around 100,000. N26 has partnered with US-based Axos bank to provide its services in lieu of a federal bank charter. UK based challenger banks Revolut and Monzo are expected to soon join the digital bank fray in the USA. Monzo announced US operations this past June.

But while digital banks seek to unthrone traditional banks – the analog crowd will not cede customers without a battle. Traditional banks benefit from deep pockets of capital and a growing interest in partnering with or purchasing Fintechs. Old banks also may claim tens of millions of customers in a sector of finance where individuals and businesses are slow to leave longstanding relationships as inertia tends to be the rule – not the exception.

Digital Bank N26 Launches in the United States via Partnership with Axos Bank

N26, a European digital-only bank, has launched in the US market. Long anticipated, N26 looks to enter one of the most competitive banking markets in the world that is dominated by global money center banks plus thousands of smaller regional operations. N26 is the first continental European challenger banking platform to launch in the US. N26 has raised over $500 million in venture capital to change the world of banking.

As a banking license is an enormous undertaking taking months, or years, to be approved, N26 Inc. has partnered with Axos Bank to offer FDIC insured accounts as well as a debit card. This strategy of regulatory arbitrage has become routine for Fintech banks seeking to set up shop in advance of receiving a national bank license.

Founded in Germany in 2013 by Valentin Stalf and Maximilian Tayenthal, N26 wants to reinvent the banking experience for a generation more comfortable on their smartphones than taking a trip to a local bank branch.  Currently, N26 claims 3.5 million customers in 25 markets, including France, Germany, and the UK.

The N26 app apparently attracts over 10,000 new users in Europe every day.

N26 claims to be one of the fastest growing challenger banks in Europe, operating with a full bank license in the region since 2016.

Starting today, 100,000 customers on the US waitlist will be allowed to sign up and have full access to the product. The beta launch will proceed a full launch later this summer.

Nicolas Kopp, US CEO of N26 Inc., said their company is excited to bring their experience to US customers. Kopp said that users love them in Europe for the experience and lack of hidden fees typical of traditional banks.

N26 is pitched as being ideal for travelers as there are no foreign transaction fees for international purchase.

Additional perks will soon be added including two free withdrawals per month at ATMs nationwide. N26 will introduce Metal, a premium tier account, to US customers, as well.

“There are no account maintenance fees or minimum balances required,” said Kopp. “We will eliminate the frustration of visiting branches, waiting on the phone, and paying fees for basic services that should already be included. We will add even more benefits and features over the summer.”

N26 is not the only digital-only bank seeking entry into the US market. Revolut and Monzo are on deck as well. Besides European competition, N26 will battle domestic digital banking operations such as Varo Money – a Fintech that is expected to be the first digital bank to receive a full banking license. There are also other digital banking operations such as Chime, SoFi and more.

While N26 may lack the name ID in the US market, it does have years of honing its product and whittling costs down for consumers to create a popular banking option.

Stalf, co-founder and CEO of N26, called the entry into the US market a major milestone. He expects to reach over 50 million customers within the next few years.

“We know that millions of people around the world and particularly in the US are still paying hidden and exorbitant fees and are frustrated by poor banking experiences. N26 will radically change the way Americans bank as it has for so many people throughout Europe.”

 

N26 to Launch in the US Soon. Can it Compete Against Big US Banks?

N26, a digital challenger bank based in Germany, expects to launch in the US in the coming weeks. A series D funding round announced in early 2019 was described as providing the war-chest necessary to launch, and compete, in the highly fragmented US banking marketplace.

N26 currently operates in 24 different European markets boasting 3.5 million customers. The number of customers is tiny in comparison to traditional banks but what many followers focus on is the current dissatisfaction of consumers with traditional banks and the rapid rate of growth exemplified by the squadron of promising challenger banks.

In January of 2019, N26  noted the tripling of their customer base during the previous year reaching 2.3 million N26 customers. As N26 just recently announced 3.5 million customers that means since January N26 has added 1.2 million customers or about 200,000 new signups each month. While old banks are far bigger this Fintech bank is clearly capturing new customers faster. But can N26 replicate that same Fintech magic in the USA across 50 different states?

The jury is out on whether, or not, N26 can march forward at the same growth rate as they are doing on the European continent. Unlike in the UK where there are just a handful of High Street banks – in the US there are thousands of banks of all sizes – not to mention Credit Unions and Savings and Loan institutions. Many of these smaller banks are deeply ingrained in the fabric of smaller communities.

The competitive landscape is far different in North America. N26, and its fellow challenger banks crossing the Atlantic, will need to have their playbook polished and ready to promote – aggressively, which will cost a lot of money.

One recent report posited that digital banks will become Fintech “road-kill” or simply a snack for traditional banks. If it becomes apparent that a challenger bank is gaining traction, a brick and mortar iteration will swoop in and Hoover them up. A good way to snuff out competition.

But, in the end, traditional banks are being forced to change, adapt, and compete. That is very good for consumers.

Mr. Potter Banker Banking (1)Old bank strategy has been to charge fees for everything they can while cutting corners on services. From ATM fees, to transfers, to international payments, and savings accounts that pay insulting rates of returns, old banks have long worked to squeeze every penny out of their customers while prominently promoting how much we all need them.

At some point, one or more of the digital banks will get it right – perhaps N26. Let’s hope this event will not take too long. Digital banking is the future.

Chatter: Digital Bank Varo Said to be Shutting Down Personal Loan Division as it Focuses on Becoming First US Fintech Bank [u]

Varo Money, one of a handful of US-based digital challenger banks seeking to receive a bank charter from the Office of Comptroller of the Currency (OCC), is shutting down its consumer lending division, according to a reliable source. Multiple employees are said to be looking for new jobs.

It is not clear if Varo will continue to offer online lending by partnering with another financial service provider.

Last September, Varo received preliminary approval from the OCC for a national banking charter. The chatter is full approval is near representing an important step in the Fitnech industry as Varo will then become the first digital bank to accomplish this feat.

Currently, Varo, like all other challenger banks, piggy-backs off the licenses of other banks to provide their banking services. Once Varo has a bank charter, they can cut the umbilical cord and go it alone.

A person with knowledge of the events at Varo had this to say:

“Personal lending landscape has become more challenging as of late. With the exit of several lenders in the past few years due to credit quality and regulatory pressure, Varo Money has decided to restructure their business and focusing on their core banking technology and shedding their personal lending division for the time being,” said the insider. “Varo is also seeking a full banking license and its approval is imminent according to sources.”

This individual said with the combination of Varo’s core banking and mobile banking technology plus the pending banking license we will soon witness the first true US Fintech bank.

They also noted that a few years ago that Fintech SoFi withdrew their attempt to become a bank during their leadership turmoil and pushback from traditional financial services. Today, SoFi provides many bank-like services without a bank charter.

The rumors about Varo come at a time when well established digital banks in the UK and continental Europe are planning to cross the Atlantic and offer their services. Revolut, Monzo, N26 and more have set their sites on the North American market.

Monzo, for example, is signing up a whopping 40,000 new accounts each week. A recent funding round gave Monzo double unicorn status as its valuation topped $2 billion.

Revolut is registering customers for both Canada and the US. N26 is accepting emails for the US.

If US born digital banks want to compete with the pending international invasion it is important for US regulators and policymakers to focus more attention on the domestic sector.


Update.

Crowdfund Insider has received the following statement from Colin Walsh, CEO and co-founder of Varo:

“To clarify yesterday’s story, we implemented a proof of concept of our direct lending capabilities that we will utilize after we open as a bank. We remain committed to providing innovative, quality personal lending products to our Varo Bank Account customers”
It appears that Varo will continue to offer online lending – it will just take a different form than previously. Perhaps Varo is partnering with a 3rd party on lending. Time will tell.

N26 Now Offering Banking Services to 3.5 Million Customers; Announces U.S. Launch Plans

Germany-based challenger bank N26 announced on Wednesday it is now offering its banking service to 3.5 million customers worldwide. The company also revealed that it is a global employer with more than 1300 employees across 60 nationalities.

“As well as headquarters in Berlin, offices in New York and São Paulo, and TechHubs in Barcelona and Vienna, we now have 24 markets under our belt, including our first non-Euro account in the United Kingdom. This means that N26 is well and truly on its way to becoming a global bank – and there’s no intention of slowing down.”

N26 then listed it’s banking accomplishments for the users, which is shared below.

N26 revealed that it is moving full steam ahead and alongside plans to enter the Brazilian market later this year, it is taking things stateside. Speaking about the upcoming expansion, Co-founder of N26, Maximilian Tayenthal, stated:

“Our US launch is the next logical step for N26 to be a global bank. Indeed, there are many people around the world looking for a simple, hassle-free way of banking. We are already one of the most valuable and highly-funded fintechs in Europe, and we will continue to build a global bank set up in Europe.”

N26 has experienced some roadblocks recently. The Federal Financial Supervisory Authority (BaFin), Germany’s banking regulator, recently published an order for N26 to remove backlogs in IT monitoring in order to establish process descriptions and workflows in writing. In response to the order, N26 revealed that the order required the company to optimize existing processes to prevent money laundering and increase N26 staffing levels. N26 reported:

“We take this order very seriously and have agreed on the implementation of the necessary measures with BaFin in advance. Ahead of the order, our anti-money laundering team had already taken measures to improve the prevention of financial crime and to address all the points raised in the BaFin order. We are therefore confident that we will implement all requirements ahead of the deadline set by BaFin.”

The N26’s U.S. expansion plans news comes the same week that Monzo, a UK-based digital banking platform, revealed its plans to expand across the pond. Revolut also announced that it is making its way to Australia.  The Fintech unicorn said they are starting in the US with a “light version of Monzo.”

Monzo has not received a banking license in the US, which is a laborious process. The bank indicated their intent to apply for a US bank license. In the US, it is a standard practice for Fintechs to partner with a bank license holder to piggyback services under their own brand.

In a release announcing their expansion, Monzo CEO Tom Blomfield slammed traditional banks saying they are a decade behind other digital-first services.

Monzo and N26 are now queuing up to join the group of domestic digital only banks like Varo Money that has received preliminary approval for a national bank charter.

N26 Set to Open New Office in Brazil

Germany-based challenger bank N26 is reportedly set to open a new office in Brazil at the beginning of March. The news comes less than two months after N26 secured $300 million through its Series D funding round, which was led by venture capital and private equity firm Insight Venture Partners, with participation from GIC, Singapore’s sovereign wealth fund, and several existing investors.

As previously reported, N26 was founded in 2013 with a mission redesigned banking to make it simple, fast and contemporary. The bank notably operates on a much lower cost base with lean organizational structures, minus green screen IT system and no expensive branch network.

“N26 passes on these cost benefits to its customers. N26 partners with the most innovative fintech and traditional financial companies to offer its customers best-in-class products such as TransferWise (foreign exchange), Raisin (savings), Clark and Allianz (insurance), auxmoney (credit) and others.”

According to TechCrunch, N26 has already made plans to make the U.S. its next market and will be launching in the country in the first of 2019. The company’s banking service is currently available in nearly 25 European countries, including the UK, Denmark, Norway, Poland, Sweden, and Iceland.

Eduardo Prota is currently set to be the general manager for Brazil. He previously worked for Santander, Cielo and various startups. Prota reportedly stated that N26 would offer a suite of mobile banking services through a partnership with a local bank, still to be forged. Prota then added that N26 has yet to apply for a banking license from Brazilian regulators.

N26 Introduces Premium Account Black in Denmark, Iceland, Liechtenstein, Norway, & Sweden

Germany-based challenger bank N26 recently announced it has introduced premium N26 Black account in  Denmark, Iceland, Liechtenstein, Norway, and Sweden. According to N26, N26 Black targets frequent travelers and it removes the “uncertainty” of exchange rates and transaction costs encountered through foreign travel and provides customers with free unlimited foreign currency purchases and withdrawals at ATMs outside the eurozone.

“For a monthly subscription of € 9.90, Black customers benefit from no mark-up fees on foreign transactions and Mastercard’s best exchange rate. Next to that, N26 Black customers have 5 free withdrawals at ATMs within the eurozone per month.”

N26 Black also offers an insurance package tailored to the needs of young professionals and frequent travelers, designed together with Allianz Global Assistance Europe. The account covers foreign medical expenses, flight delays, luggage protection, and car rental, as well as mobile phone, cash, and purchase theft protection. Speaking about the launch, Francisco Sierra, Head of European Markets at N26, stated:

“With N26 Black we offer a banking experience that is flexible and tailored to our customers lifestyle: they can organize, withdraw and spend money, as well as control finances entirely from their smartphone, with unlimited free withdrawals at ATMs outside the eurozone.”

N26 Black is currently available for customers in Austria, Belgium, Denmark, Estonia, Finland, France, Germany, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Netherlands, Norway, Portugal, Slovakia, Spain, Sweden, and the UK.

N26 Launches Subscription-Based Premium Current Account “Black”

Germany-based challenger bank N26 announced earlier this week the launch of its new subscription-based current account, Black. This news comes days after N26 celebrated its fourth birthday and weeks after the company successfully secured $300 million through its Series D funding round, which was led by venture capital and private equity firm Insight Venture Partners, with participation from GIC, Singapore’s sovereign wealth fund, and several existing investors. 

As previously reported, N26 was founded in 2013 with a mission redesigned banking to make it simple, fast and contemporary. The bank notably operates on a much lower cost base with lean organizational structures, minus green screen IT system and no expensive branch network.

“N26 passes on these cost benefits to its customers. N26 partners with the most innovative fintech and traditional financial companies to offer its customers best-in-class products such as TransferWise (foreign exchange), Raisin (savings), Clark and Allianz (insurance), auxmoney (credit) and others.”

According to N26, N26 Black removes the uncertainty of exchange rates and transaction costs encountered through foreign travel. For a monthly subscription of £4.90, Black customers benefit from no mark­up fees on foreign transactions and Mastercard’s best exchange rate, enabling them to spend at home and abroad, without limitations. Based on estimated annual expenditure and days overseas, Black members stand to save £151 a year in average fees that are charged by high street banks. While sharing more details about the accounts, Alexander Weber, Head of International Markets, added:

“The majority of UK customers are being hit by high transaction fees every time they use their card overseas. At N26, we don’t believe that spending abroad should be any different from spending at home. N26 is simplifying the daily financial decisions that customers face and N26 Black is the perfect fit for UK travellers.”

N26 Secures $300 Million Through Series D Funding Round Led By Insight Venture Partners

Germany-based challenger bank N26 announced on Wednesday it secured $300 million through its Series D funding round, which was led by venture capital and private equity firm Insight Venture Partners, with participation from GIC, Singapore’s sovereign wealth fund, and several existing investors. The company reported the funds have brought its value up to $2.7 billion.

N26 was founded in 2013 with a mission redesigned banking to make it simple, fast and contemporary. The bank notably operates on a much lower cost base with lean organizational structures, minus green screen IT system and no expensive branch network.

“N26 passes on these cost benefits to its customers. N26 partners with the most innovative fintech and traditional financial companies to offer its customers best-in-class products such as TransferWise (foreign exchange), Raisin (savings), Clark and Allianz (insurance), auxmoney (credit) and others.”

N26 reported that to date it has raised more than $500 million from various investors including Tencent, Allianz X, Peter Thiel’s Valar Ventures, Li Ka-Shing’s Horizons Ventures, Earlybird Venture Capital, Redalpine Ventures, and Greyhound Capital. Valentin Stalf, CEO and co-founder of N26, stated:

“Around the world, millions of people still suffer from bad banking experiences and high fees. With Insight Venture Partners and GIC joining our renowned group of existing investors, N26 has the support of the best investors globally to disrupt one of the largest industries in the world.”

Harley Miller, Principal at Insight Venture Partners, added:

“It’s increasingly rare these days to come across such a massive industry which hasn’t experienced disruption by technology. N26 is the clear market leader in the European mobile banking industry; the company is ideally positioned to expand to the US market this year, and build a formidable global digital consumer brand.”

The investment round comes just a couple of months after N26 announced it was bringing its services to Denmark, Norway, Poland, and Sweden. Prior to that, the fintech officially launched in the UK. N26 recently stated that it is planning to expand not only in Europe but also in the U.S.

“[we are] launching in the US mid 2018, N26 will initially offer a checking account with full use of a card, money transfers, cash withdrawals, and features tailored to the US market, including an attractive customer reward program. In the long-term, N26 plans on building a Fintech hub with more services and becoming the one-stop shop for all its customers’ financial needs.”

N26 Expansion: German Challenger Bank Brings Services to Denmark, Norway, Poland, & Sweden

Germany-based challenger bank N26 is bringing its services to Denmark, Norway, Poland, and Sweden. This news comes just weeks after the fintech officially launched in the UK. As previously reported, N26 was founded in 2013 and stated it has redesigned banking to make it simple, fast and contemporary. The bank notably operates on a much lower cost base with lean organizational structures, minus green screen IT system and no expensive branch network.

“N26 passes on these cost benefits to its customers. N26 partners with the most innovative fintech and traditional financial companies to offer its customers best-in-class products such as TransferWise (foreign exchange), Raisin (savings), Clark and Allianz (insurance), auxmoney (credit) and others.”

N26 has reportedly received backing from some prominent investors including China’s Tencent and PayPal founder Peter Theil. In total, more than  $215 million has been invested in the app based bank with $160 million coming earlier this year.  A possible initial public offering is said to be in discussion. Speaking about the latest expansion, Alexander Weber, Head of International Markets of N26, reportedly stated:

“Many customers in Europe live an increasingly international lifestyle, traveling and doing business abroad. Since our initial launch, we received a lot of requests from N26 enthusiasts outside the eurozone to offer our product in their countries. We listened to this feedback and are excited to provide our banking product to customers in Denmark, Norway, Poland, and Sweden today.”

N26 recently stated that it is planning to expand not only in Europe, but also in the U.S.

“[we are] launching in the US mid 2018, N26 will initially offer a checking account with full use of a card, money transfers, cash withdrawals, and features tailored to the US market, including an attractive customer reward program. In the long-term, N26 plans on building a Fintech hub with more services and becoming the one-stop shop for all its customers’ financial needs.”

German Challenger Bank N26 Announces UK Expansion, is the US Next?

Germany-based challenger bank N26 has officially launched in the UK in setting up an interesting battle between other competing digital banks. The Fintech reportedly issued its first British accounts on Thursday.

The launch of the UK accounts comes just a few months after N26 announced it serves more than one million customers across the European continent and doubled its customer base over the last nine months. According to N26, the monthly transaction volume exceeds €1 billion, signaling high levels of user activity and engagement.

The app based bank has received backing from some prominent investors including China’s Tencent and PayPal founder Peter Theil. In total, over $215 million has been invested in the app based bank with $160 million coming earlier this year.  A possible initial public offering is said to be in discussion.

Founded in 2013, N26 states it has redesigned banking to make it simple, fast and contemporary. The bank notably operates on a much lower cost base with lean organizational structures, minus green screen IT system and no expensive branch network.

“N26 passes on these cost benefits to its customers. N26 partners with the most innovative fintech and traditional financial companies to offer its customers best-in-class products such as TransferWise (foreign exchange), Raisin (savings), Clark and Allianz (insurance), auxmoney (credit) and others.”

N26 has made its way across 17 European markets and has more than 430 employees. Along with the UK, the bank currently operates in Austria, Belgium, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Slovakia, Slovenia, and Spain.

Speaking about the UK expansion, Alex Weber, Head of International Markets at N26, stated:

“The UK is one of the most advanced markets for online banking, but with 85pc of users with big banks.”

Valentin Stalf, CEO and co-founderN26, added;

“The UK is one of the most digitally advanced countries in the world. At N26, we have re-imagined banking for the digital age and as a result we’re the fastest growing mobile bank in all European markets we operate. Backed by our state-of-the-art technology stack and an intuitive, user-centric design, today’s launch is the first step towards delivering the best digital banking experience possible for UK customers.”

The UK is not the only country targeted for expansion. N26 predicted entry into the US market almost a year ago. At that time, N26 stated:

“[we are] launching in the US mid 2018, N26 will initially offer a checking account with full use of a card, money transfers, cash withdrawals, and features tailored to the US market, including an attractive customer reward program. In the long-term, N26 plans on building a Fintech hub with more services and becoming the one-stop shop for all its customers’ financial needs.”

The prediction to launch in the US appears to have been premature. The regulatory environment for financial services is one of the most convoluted and byzantine jurisdictions anywhere in the world. The process to gain a bank charter can be a long and arduous one, but recent changes within the federal government may see the process improve. Recent statements by federal officials indicate a greater willingness to allow Fintechs to challenge traditional banks – which are struggling to adapt to a digital future of banking.

N26 Launches New Flexible Business Accounts for Freelancers “N26 Business Black”

German digital bank N26 announced last week the launch of its new flexible business accounts for freelancers called N26 Business Black. According to N26, the N26 Business Black comes complete with comprehensive trip insurance from Allianz and users may travel worry-free with foreign medical cover based on the Insurance General Terms and Conditions.

N26 also revealed that Business Black also comes with the signature N26 Black features meaning users don’t get charged percentage fees on foreign currency ATM withdrawals. They also get a 0,1% cashback on all purchases they make with their Mastercard.

“As a premium account, Business Black lets you have up to 10 simultaneous spaces (sub-accounts). Spaces is one of our newest products which lets you break up your money into different sub-accounts so you can save towards a goal, or just better organize your money. For freelancers this can be very useful; it’s handy to break up your expenses by category. So maybe you have a travel expenses space, a business trip food space, or a space for an online course in UX design. It’s all up to you; we just want to help you get to where you want to go.”

To receive Business Black, customers must sign up before the end of October to get free subscriptions of Debitoor and Zervant. N26 is currently offering a 3-month trial of Zervant if you are from Austria, Germany, or France. All customers have access to a risk-free 3-month trial of Debitoor, regardless of country.

The launch of the new freelancer business accounts comes just a few months after N26 announced it now serves more than one million customers across the European continent. The digital bank also revealed it has doubled its customer base and its monthly transaction volume exceeds €1 billion.

Aspiring Online Money Centre bank Marcus by Goldman Sachs Nears UK Launch

Marcus began its existence as a mere online lender seeking to provide consumers with affordable credit all online. But as time moves on, it is becoming more clear that Marcus is being positioned as not just providing loans but becoming the bank of the future: a digital money centre bank to replace the entrenched stalwarts.

Marcus, the creation of Goldman Sachs, is nearing its launch in the UK. According to a report by Reuters, the digital only challenger bank has already released its service to employees for some internal testing prior to wide release. The report states that Goldman “may seek to expand its consumer bank through acquisitions or even buying a traditional lender.”

While buying a traditional lender may be an option for Marcus, there are a growing number of  European digital banks that are poised to cross the Atlantic in the other direction, setting the stage for an epic battle between the yanks and the European contingency. Both Revolut and N26 have announced their intent to set up shop in North America at some point in 2018. But it appears that Marcus will strike first with its UK invasion as their online bank will launch within weeks.

While startups like Revolut and N26 may not have the 100+ year Goldman history, nor $20 billion in deposits from which to lend, what they do have is a keen focus on the younger generation that holds traditional finance in disdain. Both N26 and Revolut have focused on features that appeal to the youth. Travel friendly and light on fees. Not to mention a good does of attitude. Revolut event provides access to cryptocurrencies.  Both European challenger banks  provide a fast, simple service that captures rave reviews. Marcus, on the other hand, has focused on industry topping interest rates earned on savings accounts.

So who is going to win in this cage match?

The consumer, of course.

That is the beauty of this Fintech struggle. UK consumers will have choice, and selection, from a plethora of challenger banks. The losers in the battle are the traditional banks, burdened with too much green screen legacy tech and too many brick and mortar locations.

And what about the US? Good question. Garnering a banking license is pretty tough for any aspiring bank. Both N26 and Revolut may have to partner with an entity that already has a banking license. Even then, US financial regulators are not known for being very innovation friendly and at times they come across as simply jurassic. But competition is a good thing and Revolut, Marcus, N26, Varo (US) and more, represent the future of banking. And that is good for consumers.