N26 Investments in Expanding Globally
German bank N26 recently reported a $3.5 billion valuation. And now, the new cash will back the firm’s ramp up hiring and stir its expansion worldwide. Recently, it launched in the United States. Then, it is planning to set on Brazil, which is due to start next year.
Valentin Stalf, CEO of N26, described Brazil as one of the most alluring and confusing in the market of retail banks. Also, the Latin American mobile lender Nubank might be the company’s direct competitor in the country.
Aside from that, the fresh investment will support the product development of the German online bank. At the same time, the firm considers redesigning its app. Also, it will add new features to encourage engagements and attract more customers from the established banks. For instance, one of the features in the pipeline is a tool named Shared Spaces, which will allow users to make sub-accounts that they can share with friends.
Stalf explained this by thinking of it as “sharing an account with friends, like a WhatsApp group.” For example, users can split their bills or book vacations. Furthermore, N26 will put a timeline for spending history, the ability to connect multiple cards to the app, and employ artificial intelligence to emphasize irregular and possibly fraudulent transactions.
Financial Technology Sector
Meanwhile, the investment causes the total funding of N26 to reach more than $670 million. And this year, it follows a set of high-profile deals in the fast-growing financial technology sector of Europe. In the first quarter of 2019, venture capitalists tapped $1.7 billion into the fintech industry of the continent.
Above all, this so-called neobanks like N26 lured millions of consumers and a lot of investments. But these kinds of firms grappled with translating their wild growth into profits. And even though the German bank is not yet a profitable company, it believes to improve margins on a per-customer basis.
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