Online banking enables a large number of customers to access their accounts anytime, even when there is no physical bank branch near them. Currently, there are only a few fintech firms in the EU with the banking license that allows them to access the whole European market.
After receiving its banking license in June, N26, a fintech startup previously known as NUMBER26, is now ready to access the whole European Union market, instead of the few countries in which it initially operated. Previously, the startup’s operations depended on a German-based banking platform, Wirecard.
N26 launched its own mobile banking app in 2015, and now has over 200,000 users spread out over 8 different countries around the world. With this app, users can open bank accounts, deposit or withdraw and even transfer money using Cash26 locations or an ATM.
Valentin Stalf, CEO and co-founder of N26 says, “This (banking license) will allow us to significantly enhance the diversity of our product portfolio. For our customers, that means access to the best financial products, right on the app.”
N26 aims at attracting more customers by expanding its mobile banking app, as well as reducing service fees. The startup stated in its press release that with this banking license, they will be able to partner up with other financial providers and fintech companies globally.
As a result, the fintech startup used Vaamo, an investment platform based in Frankfurt, to launch N26 Invest in July. The service has more than 15,000 securities available in three different plans, which allow the diversification of all investments.
Maximilian Tayenthal, CFO and co-founder of N26 states, “Millions of Euros lie in German checking accounts. In a period of low-interest rates that effectively means a financial loss. With N26 Invest, our customers have the possibility to easily put their excess funds to work.”
N26’s services is only available in Austria and Germany. With the banking license, the company is planning to launch operations in the United Kingdom before the end of 2016, or by the start of 2017.
This is where N26 comes in with the opportunity to unlock the entire market at the press of a button. Nevertheless, Brexit has become a major obstacle considering how it has affected the fintech sector in the region.
In June, N26 closed a Series B funding round of USD $40 million. Now, with the banking license, the startup is ready to get into retail banking sector.
Some of the products and services available on N26 platforms include: N26 Invest, TransferWise, Overdraft, Cash26, PULSE26, N26 MasterCard and MoneyBeam. Since its establishment, N26 has already invested USD $53 million.
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