German online bank N26 shutters US service
German online bank N26 said Thursday it was closing its operation in the United States next year, as regulators in Europe place the "fintech" start-up under increased scrutiny.
N26's 500,000 customers in the US would be able to use their services until January 11th, 2022, the bank said in a statement, after which it would cease to operate in a market it first entered in 2019.
Instead the Berlin-based operation would "sharpen its focus on its European business", where it already operates in 24 countries and is exploring expansion into more eastern European markets.
N26 said it would also look to launch new "investment products in the coming year" to sit along side its current account service.
Founded in 2013, N26 offers free, online-only banking services to around seven million clients and is one of Germany's most high-profile financial technology or "fintech" firms.
In October, the bank raised $900 million from private investors, and announced a plan to hire a further 1,000 employees to reinforce its product development, technology and cybersecurity teams.
READ ALSO: German online bank N26 to create 1,000 jobs
At home, N26 has been in the crosshairs of the German banking watchdog BaFin since 2018 after a local news media investigation found that it was possible to open account with forged IDs.
Earlier in the month, the regulator said it was upping its oversight operations at N26, appointing a special representative to monitor the bank's progress towards solving issues in "risk management with regard to IT and outsourcing" identified by BaFin.
The regulator also limited the number of new customers N26 could take on to 50,000 a month until the shortcomings were addressed.
N26 was already being monitored by BaFin over failures in the start-up's anti-money laundering system.
BaFin issued N26 with a 4.25-million-euro ($4.8-million) penalty earlier this year in connection with around 50 "suspicious transactions" the bank failed to report promptly enough.
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N26's 500,000 customers in the US would be able to use their services until January 11th, 2022, the bank said in a statement, after which it would cease to operate in a market it first entered in 2019.
Instead the Berlin-based operation would "sharpen its focus on its European business", where it already operates in 24 countries and is exploring expansion into more eastern European markets.
N26 said it would also look to launch new "investment products in the coming year" to sit along side its current account service.
Founded in 2013, N26 offers free, online-only banking services to around seven million clients and is one of Germany's most high-profile financial technology or "fintech" firms.
In October, the bank raised $900 million from private investors, and announced a plan to hire a further 1,000 employees to reinforce its product development, technology and cybersecurity teams.
READ ALSO: German online bank N26 to create 1,000 jobs
At home, N26 has been in the crosshairs of the German banking watchdog BaFin since 2018 after a local news media investigation found that it was possible to open account with forged IDs.
Earlier in the month, the regulator said it was upping its oversight operations at N26, appointing a special representative to monitor the bank's progress towards solving issues in "risk management with regard to IT and outsourcing" identified by BaFin.
The regulator also limited the number of new customers N26 could take on to 50,000 a month until the shortcomings were addressed.
N26 was already being monitored by BaFin over failures in the start-up's anti-money laundering system.
BaFin issued N26 with a 4.25-million-euro ($4.8-million) penalty earlier this year in connection with around 50 "suspicious transactions" the bank failed to report promptly enough.
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