App-only N26 launches in the UK

N26 CEO and cofounder
Valentin Stalf.
N26

• German app-only bank N26 is launching in the UK on Thursday.
• The startup, which is backed by Peter Thiel’s Valar Ventures,
  already operates in 17 countries across Europe and has 1.5
  million customers.
• N26 plans to launch in the US early next year and wants to
  “build the world’s first global bank with maybe 100 million
  customers.”

LONDON — German app-only bank N26 on Thursday announced plans to
launch in the UK as it continues its rapid expansion across
Europe.

N26, which first launched in Germany in 2015, said it plans to
run a “beta” testing phase before rolling out to its
50,000-strong UK waiting list in the coming weeks.

“I think we have a fair chance to make the UK one of our
strongest markets,” N26 cofounder and CEO Valentin Stalf told
Business Insider in a recent interview. “The experience that
we’ve gained in the other markets [means] we are very confident.”

N26 was founded in Berlin, Germany, but currently operates in 17
markets across Europe. It has 1.5 million customers and Stalf
said the bank is signing up 5,000 to 6,000 new customers a day.

“The big things that we’ve learned is that the needs of the
customers are very much the same independent of which country
they’re in,” Stalf said. “There’s this hypothesis that banking is
very local. I think this hypothesis is kind of wrong. The needs
of — especially the digital generation — are kind of the same all
around Europe, even all around the world I would say.”

Britain already has several digital-only banking startups
targeting consumers, including Monzo, Revolut, Starling, Tandem,
and Atom. Stalf said he was not worried about competition.

“If you look at the markets we’re in already, most of the
customers we win, the people are not coming from other digital
banks but they’re coming from the traditional banks,” he said.
“If you look at the UK, I think 75% of the market is with the
four big banks. The primary goal is to really give these people a
better user experience, no rip-off pricing, and more
transparency.”

Stalf said that N26, which has a full banking license from German
regulators, will differentiate itself from others such as
Revolut and Tandem by positioning itself as a full
replacement for a bank account.

“We’ve our own banking license in Europe, we’ll offer all the
sort codes and full account functionality,” he said.

N26’s next goal is to launch in the US in the first quarter of
2019. 

“We have the ambition to build the world’s first global bank with
maybe 100 million customers,” Stalf said. “We think the time is
right to build a global banking brand. You have that with Spotify
and Netflix in films or music, but you don’t actually have it in
finance. In finance, the underlying product is much more
profitable than music or films.”

The startup has raised over $200 million from backers
including Tencent, Allianz, Peter Thiel’s Valar Ventures,
and Horizons Ventures, the venture capital business of Hong Kong
billionaire Li Ka-Shing. It is already processing over €1 billion
in monthly transactions.

“Building a bank that people love to use is our vision. It’s for
our generation,” Stalf, 33, said. “That also makes a difference
to most of the traditional banks.”