European Business: Mr. Tayenthal, what motivated you to establish a fintech start-up?
Maximilian Tayenthal: We wanted to initiate sustainable change. That was the reason why we founded our own business. Even back in 2013, it was obvious that the European finance market would have to change sooner or later. Already, there was a strong trend from online to mobile applications. Yet, the user interfaces of the established banks looked like the internet of the 1990s. Another important driver of our business was the changing lifestyles of young Europeans. Today, young people grow up in Vienna, move to Amsterdam to study, do an internship in London and start their first job in Berlin. Against this background, it is ridiculous that people have to open a separate account in every country. Therefore, N26 was meant to break down barriers to movement which had been torn down by politicians long before.
European Business: Still, this is an ambitious goal which will not be easy to achieve.
Maximilian Tayenthal: We live in the 21st century and it still takes too much time to open an account. In general, banking is complicated. For example, credit transfers take an extremely long time. This must change. N26 uses the existing technologies based on our intellectual property. Our goal is to offer an account which is easy to handle and transparent for everyone who prefers mobile banking.
European Business: 2016 was a turbulent year for N26. What lessons have you learnt?
Maximilian Tayenthal: In the end, 2016 was a successful year for N26. The European Central Bank granted us a banking license. This is an important milestone in our development. Our latest financing round brought Li-Kashings Horizons Ventures on board with an investment of over 40 million USD. Also, we were able to expand into nine new countries and our growth rates have been tremendous. In addition to this, we successfully moved our system to our own banking platform. Another proof of the relevance of N26 is that we were the only European bank to be mentioned by Apple at the WWDC (Worldwide Development Conference). Referring to 2016 – I believe that it is normal for a young company to face ever new challenges. All-in-all, we learnt a great deal last year – including how to improve our customer communication. This means we are much better positioned now.
European Business: What are your plans for 2017?
Maximilian Tayenthal: This year, we will expand the portfolio of our major financial products. Our app will also include an insurance and a savings product. Only recently, we launched a loan product which can be concluded without leaving our app – within only a few minutes. The whole process of the credit check, identification and conclusion is covered within the app. As soon as the application is approved, you have the money in your account.
The subsidiaries will not be able to offer their customers added value any more. Therefore, they will become unprofitable in the long run. Maximilian TayenthalCo-Founder and Co-Owner
European Business: Will you address the corporate client sector this year? If so, what will you offer?
Maximilian Tayenthal: We already offer a business account for small and medium sized companies and for freelancers. Our current focus is on private customers. We would like to offer them the best banking experience possible. We will move into the corporate sector sooner or later, as this market segment offers great growth and innovation potential. Today, business accounts are extremely expensive for entrepreneurs. Also, they are very old school in terms of digital features.
European Business: Where do you see the regionally rooted banks such as the Volksbanken, Raiffeisenbanken and Sparkassen in the German banking market in the long run?
Maximilian Tayenthal: They will become less and less important. There is no doubt that people will continue to change their banking habits and move towards mobile banking. Thus, the subsidiaries will not be able to offer their customers added value any more. Therefore, they will become unprofitable in the long run.
European Business: Where do you see N26 in 2020?
Maximilian Tayenthal: N26 will have a significant share of young customers in Europe. We will be THE benchmark in mobile banking. In the long run, we will not only make our customers’ banking affairs easier with our app but also other aspects of life.