German digital banking startup N26 launches in the U.S.
The company’s U.S. subsidiary N26 Inc will start making its services available to the 100,000 customers on its U.S. waitlist over the next few weeks and will fully launch to the public later this summer, it said.
The company is one of Europe’s most well-known “neo banks” that were set up over the past few years to compete with traditional banks by offering more user-friendly digital services.
It has amassed 3.5 million customers in 24 European markets since its initial launch in 2015 and raised more than $500 million from investors including Insight Venture Partners, Tencent and Peter Thiel’s Valar Ventures.
N26 holds a banking license in Europe. In the United States it is launching through a partnership with San Diego, California-based Axos Bank, which is a member of the Federal Deposit Insurance Corporation.
“As a long-term strategy I could see us getting a license (in the U.S.), but we are not in a rush,” Nicolas Kopp, U.S. CEO, N26 Inc, said in an interview. The U.S. app will have many of the features that have made N26 popular in Europe, such as the ability to create sub-accounts it calls “spaces”, Kopp said.
The account will have no minimum balance requirement or monthly charges, he added. Over the summer N26 will start offering two free withdrawals per month at ATMs nationwide and later introduce a premium account, the company said.
N26’s U.S. launch, which has been around two years in the making, comes less than a month after British digital bank Monzo started rolling out its services overseas.
N26 will also face competition from local digital banks, established U.S. banks and their digital offshoots, as well as a growing number of financial technology startups who have recently started offering banking services.