Berlin-based startup Number26 is trying to reinvent the bank. This might sound crazy, and that’s why the startup has processed step by step. After partnering with Wirecard for the banking back end, attracting 200,000 users and raising tens of millions of dollars, the company now has a full banking license to operate in Europe.
The European Central Bank and the German regulator have given this banking license just a year and a half after the startup launched in Germany — since then, the startup is now also available in six other countries.
Atom Bank in the U.K. also holds a banking license but it looks like Number26 might be paving the way in the Eurozone.
This is a big step for the company as Number26 has been a bit limited until now. Without a banking license, the startup could only provide a better user interface. It had to fight with restrictions from Wirecard and integrate other products, such as TransferWise. Now, Number26 can go further.
“For our customers, it means that our product will become even more real time,” co-founder and CEO Valentin Stalf told me. “We are already working on different features — one that will launch soon is expense sharing, which will enable customers to share expenses with a simple swipe between friends. It’s similar to splitting a fare in the Uber app.”
In addition to partnering with other fintech startups, Number26 can now build its own financing products, such as savings accounts, investment products, credit offerings and more. In other words, the startup will become a full-fledged bank faster.
“We are launching an investment product within the next few weeks already and plan to launch products for savings, credit and insurance within the next 6 to 12 months. Some of them will be our own products directly out of our bank, most will be partnerships,” Stalf said.
Switching to the startup’s own back end probably won’t happen overnight. The transition from Wirecard is going to take a bit of time. But this is encouraging for the product roadmap.
“Most importantly, it will give us the opportunity to offer accounts on a cost base that is 5 to 10 times lower than traditional banks,” Stalf said.
Oh, and by the way, Number26 is now simply called N26. With a European banking license, the company is no longer limited by its banking partner, which should also speed up its geographical expansion over the coming months.