German fintech startup N26 is closing down its operations in the U.K. Prospects who opened a bank account in the U.K. need to switch their deposits, spend everything with their card or withdraw cash at an ATM, as all accounts will be routinely closed on April 15.
Many European fintech companies take advantage of a European course called passporting. It lets companies apply for a license to operate as a bank or a financial service in an EU member state and then expand to all EU member states.
N26 has to exit from the U.K. banking market as a result of it currently has a European banking license through the central bank of Germany. Passporting is going to change after Brexit.
Specifically, European firms that operate in the U.K. utilizing inward passporting need to follow a new utility process so as to continue working in the U.K.
N26 faces a ton of competition in the U.K. from Monzo, Starling, and in Revolut. It’s possible that N26 didn’t wish to invest plenty of money and time so as to arrange a proper subsidiary firm in the U.K. with its banking license.
Users will have to transfer their funds in other bank accounts before April 15.