Danish neobank Lunar Way has signed deals with major banking partners in its home country and neighbours Sweden and Norway as it prepares to expand across the Nordics.
Following a well-established trend started by Simple, Lunar Way is promising to bring slick, digital banking services to millennials, while outsourcing the regulatory hassle to partners.
The new bank, which is running in a beta phase in Denmark, has struck a deal with the country's largest mortgage provider Nykredit to provide the back-end processing for its banking services. The incumbent banking partner has also taken a minority interest in the startup.
Similar banking relationships have also been lined up in Sweden and Norway, says Lunar Way founder and CEO Villum Klausen.
"In addition to the strengths offered by the traditional neobank model, we have unique strengths, as we’re the only one in the market built upon partnering with multiple local partners," he says. "This means a Swede will have a Swedish account, a Dane will have a Danish account, a Norwegian will have a Norwegian account - all through the same interface, the Lunar Way app. And there will be no ”middleman” costs. Both parties win - partner banks, consumers and Lunar Way.”
Local waiting lists have been set up in each country in preparation for launch. Users will get access to a MasterCard debit card and an app that offers an overview of accounts and transfers, and lets them deposit money, pay bills and login via Touch ID.
The firm, which is backed by Scandinavian venture fund Seed Capital, has set a target of 85,000 Nordic users in 2016, before expanding outside of the Nordics in 2017.Finextra will be assessing the impact of innovation and challenger banks on the Nordic banking market in our annual NextGen Banking - Nordics 2016 event at Helsinki's Finlandia Hall on 11 October. Registration for the conference is now open.