FinTech: German Fintech And Banking Challenger N26 Raises $900M At $9B Valuation

October 19, 2021 | FinTech, News, Venture Capital
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That valuation is a shade above the $8.8 billion market cap of Commerzbank, Germany’s second-largest listed lender.

N26 GmbH, the German fintech that is challenging banks on their turf, announced Monday a raise of over $900 million in a round led by Third Point Ventures and Coatue Management, with participation by Dragoneer Investment Group as well as existing investors. N26 said the “record-breaking” round valued it at more than $9 billion, placing it within the top 20 global fintechs, and the most valuable one in Germany. (N26)

N26 primed for growth in mobile banking

“This recent financing round solidifies the fact that retail banking as we know it has changed,” said Valentin Stalf, CEO and co-Founder. “With our fresh capital, we are in pole position to become one of the biggest retail banks in Europe, all without a single branch.”

Valentin Stalf and Maximilian Tayenthal founded N26 in 2013 with an eye on mobile banking. Since then the company has raised approximately $1.8 billion from some of the world’s most reputed investors.

Currently, the fintech serves over 7 million customers in 25 markets and employs over 1,500 employees at offices in 10 cities across the world – Amsterdam, Berlin, Barcelona, Belgrade, Madrid, Milan, Paris, Vienna, New York and São Paulo.

“N26 has established itself as a leading tech-forward global fintech organization,” said Heath Terry, Partner at Third Point Ventures. “We are excited to provide capital and strategic support to accelerate N26’s work to deliver their world-class mobile banking experience to millions.”

However, BaFin puts brakes on N26 growth

According to the FT, in early October, German banking regulator BaFin imposed tough limits on customer acquisition by N26 after it was unhappy with the bank’s resolution of certain issues it had raised, and for organisational flaws.

BaFin has imposed a ceiling on the number of new customers the lender can onboard on its platform – a maximum of 50,000 to 70,000 per month – a far cry from the average 170,000 clients joining up with N26 through this year.

“N26 has agreed with the German regulator to temporarily onboard a maximum of 50,000 – 70,000 customers per month,” the bank admitted in a statement on Monday.

This is the latest salvo fired by BaFin at N26 in a frayed relationship that has lasted more than two years.

BaFin also appointed a special supervisor about six months ago to oversee the implementation of improvements in anti-money laundering controls it had ordered at the fintech.

Related Story: Thiel-Backed N26 In Funding Talks, Could Value At $10B

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