European startup fintech N26 now accepts customers in the United States. The company is launching a bank account with a debit card that should offer a better experience than traditional retail banks.
If you know N26, the product put online today will not surprise you much. Customers in the United States can download a mobile application and create a bank account from their phone in just minutes. It's a real bank account with payments, routing and ACH account numbers.
A few days later, you receive a debit card that you can control from the mobile application. Whenever you make a transaction, you'll instantly receive a push notification that tells you how much you've just paid. You can set your PIN, customize limits, enable and disable online payments, ATM withdrawals or payments abroad.
And that's about all there is to know. But what about fees? Basic N26 accounts are free. There is no monthly fee or minimum balance. Foreign currency transactions are free and you get two free ATM withdrawals per month.
N26 will gradually roll out its listings this summer as a kind of beta program. If you have signed up for the waiting list, you will receive an invitation within the next hours, days and weeks. There are currently 100,000 people on the waiting list. N26 will then open registrations for everyone later this summer.
When N26 launches its final product in a few months, the company announces its intention to automatically track and refund the fees charged by ATM operators. N26 cards in the United States operate on the Visa network instead of Mastercard.
Like Chime, N26 will also try to charge you up to 2 days in advance if you are paid by direct deposit. Instead of waiting a few days to clear these transactions, N26 will launch and complete your account.
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Behind the scenes, there are some differences between the N26 in Europe and the N26 in the United States. Although the N26 has a full banking license in Europe, the company has partnered with Axos Bank, which is a white label partner in the United States.
Axos Bank essentially manages your money for you and N26 acts as an interface between customers and their bank accounts. As a result, you get an account insured by the FDIC.
N26 has for the first time partnered with a third-party company in Europe. But it was an expensive affair that was not supposed to stay in place. The start-up has obtained a profitable banking license in Germany for Europe as a whole. In the United States, the situation is different because the market is not as unified as in Europe: it is complicated to obtain a license to operate in the 50 states.
"We have looked at 30 players, we have done due diligence and we are happy to partner with Axos Bank. The contracts you enter into the United States for private banks are much more favorable than in Europe, "said N26 co-founder and CEO Valentin Stalf. "It's a configuration for the long term. It's good for a few million customers, "Stalf added later in the conversation.
Just a start
N26 already provides more features for the United States. The company plans to roll out two premium plans – N26 Metal, then N26 Black.
And it seems that there will be changes regarding the benefits for Premium users. "We took that to a separate level," said Stalf.
Another characteristic, the shared spaces arrive finally in the months to come. Spaces are sub-accounts designed to put money aside. You can drag money from one space to another or you can configure automated rules.
Eventually, you will be able to share a space with other people in order to save money and spend money together. It will work "like a WhatsApp group," Stalf said.
N26 currently has 3.5 million customers in Europe and has raised more than $ 500 million to date. There are now a thousand people working for N26 in Berlin, 60 employees in New York, 80 people in Barcelona and a small team of 5 to 10 people who will soon start in Vienna.
"He went from a small business to an international company," said Stalf.
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