Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Peter Thiel-backed mobile bank N26 says it's luring deposits from US titans like Chase and Citibank

Peter Thiel-backed mobile bank N26 says it's luring deposits from US titans like Chase and Citibank

N26 says it has attracted 250,000 users in the U.S. It claims new customers are shifting funds from the likes of Chase and Citibank.
It’s one of a breed of new banking challengers that have gained millions of customers without any branches.

The German start-up’s U.S. launch wasn’t flawless, and it faced some critical feedback from users initially.

German mobile bank N26 has attracted 250,000 users in the United States, where it claims new customers are shifting funds from established giants like Chase Bank and Citibank.

The financial technology company, which is backed by controversial Silicon Valley venture capitalist Peter Thiel, started life in Berlin nearly seven years ago. It’s since expanded throughout Europe and began U.S. operations in July 2019.

“We track where the money comes from when people fund their accounts, and I definitely see some of these big-name banks crop up quite frequently,” N26′s U.S. CEO Nicolas Kopp told CNBC in an interview. “So far, that’s where I see a lot of customer growth for N26.”

N26, one of a breed of new banking challengers, is known for its slick app design and clear debit card. As is the case with rivals like Monzo, Revolut and Starling, people can sign up for an account with N26 within minutes and don’t pay any additional foreign exchange fees when spending abroad.

The bank remains a long way from challenging the dominance of the Big Four in the U.S. -which also includes Wells Fargo and Bank of America -and faces stiff competition from U.S. upstarts like Chime, which reported 5 million users last year. N26 said it has 5 million customers globally.

N26 hasn’t broken out its user numbers to disclose how many customers are switching their accounts from the big banks. That’s been a problem for many online banks across the pond, with Monzo having claimed that only 30% of its customers use it as their primary account.

N26 relaunched in America last August, one month after first entering the market, with a perks program offering discounts and cashback from brands like Booking.com and Lime. The European start-up doesn’t have a federal bank charter of its own, so it’s instead partnered with a small institution called Axos Bank.

The company’s journey into the U.S. hasn’t been flawless. It experienced some critical feedback at launch due to free ATM withdrawal limitations. The bank then expanded free-to-use machines under a deal with interbank network Allpoint. “We’re constantly improving,” Kopp said.

N26 doesn’t offer credit cards or lending products in the U.S., instead sourcing the bulk of its revenues from so-called interchange fees which are paid by merchants when one of its debit cards is used to pay for something. Kopp said it’s received positive feedback from users on features like getting paid salaries two days earlier and shared accounts.

“N26′s entry to the USA is most evident in cities like New York where their marketing has been highly visible for months now,” Will White, head of international at fintech consulting firm 11:FS, told CNBC by email.

“It will be interesting to see where, and in which USA demographics, they get the most traction, given the range and depth of consumer banking already available from both incumbents and digital challengers.”

Alongside N26, Monzo has launched in the U.S. too with a partner bank of its own, though its presence there is still in the very early days. Kopp said N26 is considering applying for its own U.S. bank license, but “we haven’t decided yet.”

So-called challenger banks have seen considerable growth globally despite lacking physical branches, a feat achieved in no small part due to the gush of venture capital flowing into the sector. Brazil’s Nubank is among the best-funded neobanks and was last valued at $10 billion.

N26 last year raised a whopping $470 million from investors including Insight Partners, Thiel’s Valar Ventures and Chinese tech firm Tencent, while Monzo is reportedly in talks with SoftBank about an additional cash injection to last year’s £113 million ($148 million) funding round.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
×