By Aisling Finn on Thursday 13 February 2020
The Berlin-based digital bank earlier this week cited Brexit as the reason for its UK exit, but other challengers seem to be benefiting.
Following the announcement that N26 was leaving the UK, apparently due to regulatory issues relating to Brexit, digital banks saw a surge in transfers and customers from the German challenger bank.
Monzo, one of N26’s fiercest British rivals, saw an uptick of over 250 per cent in payments made into Monzo from N26 on the day it announced it was leaving the UK.
Starling Bank also saw a jump in customer numbers since the announcement but could not discern whether or not the increase was as a result of N26 or its recent heightened media coverage.
A spokesperson for Starling said that it had a definite increase in customer numbers this week but it was “very muddled with the recent news we have raised £60m for overseas growth”, which has garnered a lot of media attention this week.
Similarly, digital challenger bank Monese saw an increase in new customers and 200 per cent surge on incoming payments from N26 UK on Tuesday.
Norris Koppel, CEO and founder of Monese, said: “The UK is the world’s most crowded neo bank market and N26 knew that when it joined so it was always going to be difficult. What works in mainland Europe doesn’t always work here.
“When you launch something in a very specific market you need to ensure that you are making something that is specific to that market and meets the local market needs”.
“This is a sad day for us, we’re all startups at the end of the day and all very young companies who are trying to do a good thing and create a better experience for our customers and so from that perspective we tried to remain neutral and sympathised with N26’s situation”, Koppel added.
Koppel also told AltFi that Monese has seen an increase in worry and uncertainty from customers following the news, and wanted to reassure customers that it would be around to pick up their accounts if they wanted.
Serious doubts have been cast on the reasoning behind N26’s UK exit, experts believe Brexit has very little to do with it, rather N26 simply failed to offer an attractive product in a hyper-competitive market.
Revolut didn’t respond to comment from AltFi.
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