This week we round up a selection of the activities happening at neobanks, some of which may point to what the future looks like for them.
N26 fined €4.25m
The Germany-based digital bank has been fined a hefty €4.25m for lax money laundering controls. N26 has been facing heightened scrutiny from German regulatory authorities over the past two years, with a focus on the implementation of appropriate internal controls and safeguards and comply with general due diligence requirements. The fine related to the late filing of amost 50 suspicious activity reports by the bank in 2019 and 2020, and the bank has been told “to ensure that it has the adequate personnel, technical and organisational resources to comply with its obligations under anti-money laundering law.”
Starling Bank expands in Europe
Starling’s expansion into Europe has been on the cards for some time, and now it has revealed that it will be offering Europe “a banking-as-a-service technology package, rather than a customer-facing proposition.” Arriving in the first half of 2022, Starling will launch its services in France, Germany, the Netherlands and Spain.
The package will enable businesses to build their own financial products on its banking platform, such as savings or current accounts, integrated digital wallets, kids’ cards and debit cards. Starling will oversee and manage the technical and regulatory demands behind the scenes, while the businesses using it take care of the customers’ needs.
Starling CEO Anne Boden, “The thriving technology and fintech scene in European markets makes them a great fit for the culture of innovation at Starling, and therefore a natural space for us to offer and develop our solutions in Europe.
We have seen a consistent and growing demand for digital financial services, further accelerated by extended lockdowns and a shift in consumer behaviours in key European markets, and it is clear that Starling can power new and exciting opportunities for businesses across Europe”
Santander to shut PagoFX
Banco Santander has announced that it is closing its PagoFX service on 30th November. The service was designed to compete with Wise and Revolut. The Spanish bank said: “It has been decided to close the international money transfer service in the UK, Spain and Belgium. PagoFX’s technology and resources will be used to support the wider PagoNxt Group and its customer proposition.” PagoFX initially allowed UK residents with a debit card issued by any UK bank or financial institution to send money abroad using just their smartphone. Initially the project attracted major talent from big tech companies, but they have been leaving for other roles recently, so this latest news is perhaps unsurprising.