Exclusive: N26 plans its trading feature for the beginning of 2022, crypto trading should start at the end of this year. To do this, it relies on a Serbian partner – and is building a development hub on site. What about Neobank’s strategy?
Valentin Stalf is not a big crypto fan, but he bowed to the demand: “Customers want crypto,” he said in the spring. His Neobank N26 is working on making crypto trading accessible to seven million users via the app, it said. After a few months of silence, there are now new details: By the end of the year, customers should be able to trade in Bitcoin and Co., announced the Co-CEO in an internal meeting. For the feature, N26 is also building a development hub in Serbia in order to benefit from the technical talents in Eastern Europe, according to research by Finance Forward.
High expectations from the industry
Germany’s most important smartphone bank is trying to convey this optimistic mood to the outside world. The managers and founders of N26 are repeatedly suggesting new products these days – a whole “marketplace” is planned for the app, CEO Valentin Stalf recently explained. It should be a kind of super app that customers can use to organize all sorts of financial topics in the long term. Now it is up to N26 to actually launch the new features and products, the industry is waiting for them.
There are high expectations, for example, of the announced trading feature for stocks. Little is known about this so far, apparently there have been discussions with various partners. Now the fintech is announcing at least a launch date: it should start in early 2022.
For the crypto feature, N26 is now relying on its own development. According to information from Finance Forward, N26 is working with a partner in Serbia for the feature. The company does not want to comment on this, but does state that the crypto feature will “probably go live by the end of this year”.
As part of the joint venture with the Serbian partner, N26 is building a development hub in Belgrade. With this, it wants to strengthen its presence in Eastern Europe. “The 40-person team there works closely with the global product and technology teams at N26,” said the spokesman.
The feature came as a surprise to many. So far, N26 had been rather skeptical of the industry, in the general terms and conditions there was a note that crypto transactions can lead to the termination of the account. In both projects – crypto and share trading – N26 is now under pressure because its worst competitor, Revolut, introduced the functions a long time ago.
Team in Brazil is growing
There is also progress on another important project: the launch in Brazil. According to the company, the office in Sao Paolo has grown back to “almost 30 employees”. “You are currently developing a product that will be specially tailored to the Brazilian market,” said the spokesman. That does not sound like a withdrawal that was last hinted at.
In 2019, N26 started with a lot of fuss in the USA, at the same time it had big plans for Brazil as well. However, both expansion plans turned out to be difficult. The office in São Paulo has meanwhile been almost completely paralyzed, because a change of strategy took place for the location: Instead of relying on a partner as in the USA, N26 decided to apply for its own license in Brazil.
The team was reduced to a handful of employees who were supposed to deal with regulatory issues there. In January, N26 was surprised by the central bank with a license, internally nobody had really expected it at the time. In an interview, Stalf said: “We will announce the details of the market launch at the end of the first quarter.” Now it is clear: The company is specifically working on a launch.
The project will not be easy for N26, after all, Brazil is Nubank’s home market, which is currently probably the largest neo bank in the world with 40 million customers. In addition, the requirements differ for all markets in which N26 was previously active. Millions of Brazilians do not have an account so far, and the Berlin fintech has to adapt the approach to customers. In addition, a lot is bought on credit, which N26 has to react to and create its own offer for the country.
Search for the US boss is ongoing
However, things apparently went better in the USA, although the company in New York has not had a Country Manager for a year since Nicolas Kopp left the company. Stephanie Balint and Timo Meyer are currently managing the US business on an interim basis, while the search for a US CEO is still ongoing. “Business there also developed positively during the corona pandemic,” said the spokesman. In August it announced the first 500,000 customers and the transaction volume had increased well. “In the last year in particular, we were able to win numerous new customers and this trend will continue in 2021.”
The success in the USA and Brazil is important to convince investors that it is possible to conquer large markets apart from Europe. The example of Klarna shows how important a US expansion is: Thanks to the momentum in the important and large market, the Swedish payment company was recently able to massively increase its valuation – and received another 1.6 billion dollars in the past few months. N26 will certainly collect money again soon.
–
