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N26 puts a positive spin on BaFin customer cap

N26 puts a positive spin on BaFin customer cap

In a blog post to customers, N26 has sought to gloss over a move by Germany's financial regulator, BaFin, to impose a temporary cap on the number of new customers the digital challenger is allowed to onboard each month.

N26, which earlier this week announced a $900 million funding round at a $9 billion valuation, has agreed to accept between 50,000 and 70,000 new customers a month until it has addressed issues raised by BaFin.

The digital lender has been signing up about 170,000 customers a month this year, according to the Financial Times.

N26 has been facing heightened scrutiny from German regulatory authorities over the past two years.

Last month it was fined €4.25 million over lax money laundering controls. In May, the watchdog appointed a special commissioner to monitor the fintech giant's compliance with an order to implement appropriate internal controls and safeguards and comply with general due diligence requirements.

N26 has also been told to ensure that it has the adequate personnel, technical and organisational resources to comply with its obligations under anti-money laundering law.

In a blog, N26 makes no mention of BaFin, instead writing: "To lay even stronger foundations for our business in the future, we are increasing our focus on our service experience, product offering and processes—to become an even better bank for you in the years to come.

"Based on this decision, in conjunction with the overwhelming demand for N26’s digital banking products, we will be making a temporary adjustment to the number of new bank accounts that we can offer each month."

Potential customers are encouraged to sign up to a waitlist, while current uses are reassured that they are not affected by the move.

Comments: (1)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 22 October, 2021, 11:00Be the first to give this comment the thumbs up 0 likes

Regs have collected hundreds of millions in fines from megabanks for violation of AML rules but, AFAIK, they have not imposed a ceiling on number of new customers they can onboard. Wondering why they're doing so on a neobank for the same tresspass. Is it due to lobbying by big banks or because they're not happy with the mere millions in fines they collected from N26?