N26 to end US operations
The US digital banking market appears hard to penetrate for international startups
The well known German neobank N26 announced on November 18 it will shut down its U.S. operations.
"In our industry, the level of synergy moving from Europe to the US is not like WhatsApp that you can internationalize easily… We had to build the bank from scratch with different licenses, agreements, and payment rails.” N26 co-CEO Max Tayenthal stated to Business Insider in a report published on November 13.
I think that quote summarizes a situation that many agree on in the fintech industry. The American market is rather hard to penetrate for neobanks. Case in point: three weeks ago, UK-based Monzo scrapped its U.S. banking licence plans.
Let’s face it, the U.S. has a number of well-funded digital-fist banks and many modern offerings from incumbents. Perhaps those missed expansions will force fintech startups to explore new (greener?) pastures.