Smartphone Bank announces Start-up in Switzerland

In professional conferences and media events from banks they are omnipresent: the Fintech company, so a new, digital Challenger of top dogs, such as UBS , Credit Suisse or the cantonal banks. But so far, these companies are for regular Bank customers, primarily a media phenomenon. That will now change.

As the Smartphone Bank N26 wants to start in Switzerland. "Yes, the Launch of N26 in Switzerland is planned for 2019," said a spokeswoman on request.

Norman Karrer, Partner in the financial industry specialized consulting company ZEB, sees this as a warning shot for the local banks. The announced market entry was not a "Gamechanger" that will stir up the local market in depth through each other. The Start of the N26 but "a clear signal effect, and would underscore the need for the classic Swiss retail banks need to accelerate the digitisation of their offer", says Karrer.

account with credit card and travel insurance

N26 only has around 750 employees, is currently active in 24 countries and claims to have 2.3 million customers. The Smartphone-Bank payment accounts is primary. Depending on the model, users pay a fee. The products come mostly from partners. In the case of N26 Black, for example, the customer gets an account with a credit card and a travel insurance that is provided by the Alliance . The Munich-based insurance giant is also one of the shareholders of N26. Also Paypal co-founder Peter Thiel is involved on the capital.

The Berlin-based Start-up N26 has just completed a new round of financing of over EUR 260 million. The Fintech is a rating company, with 2.3 billion Euro. This corresponds to around 80 per cent of the value of the private Bank Vontobel. With the fresh funds N26 want to drive the international expansion. The primary use of the money is intended, in the United States to attack. Apparently, the company now has the funds in the Swiss market to attack.

Neobanken place in the whole of Europe

A similar concept as N26 the British Revolut, which is focused primarily to favorable foreign exchange transactions followed. Revolut has to get in the middle of December a Bank license in Lithuania. Also Revolut trying to Swiss customers, and has opened to it at Credit Suisse, a correspondence account. Accordingly, deposits of Switzerland are now possible, if the customer indicating the appropriate reference number at the time of Deposit. According to the "Handelszeitung" has Revolut in Switzerland 50'000 customers.

of smartphones, banks not only rely on cheap prices, but mainly on a very simple use of banking services via the App. In Europe, these so-called Neobanken have already gained significant market shares. In France, for example, According to the French Bank supervision, these new players have a market share of 6.5 percent. Even more important: the number of new customers Neobanken would win around one-third.

Swiss banks and the "Kodak effect"

According to the consulting firm ZEB the new Player a de facto play in Switzerland. Accordingly, Fintech would have company in this country, with a market share of less than 0.1 percent. However, the strategic potential of the new Player but it is "indisputable", as it says in the study.

Together with the Swiss Finance Institute, ZEB has determined in a survey about the awareness and the implementation in terms of digitisation in Swiss banks in a European comparison. The result: "the banks have no knowledge of the problem in terms of digitization, they are lagging in the implementation," says ZEB-Partner Norman Karrer. Thus, only 4 percent of the processes from A to Z are in the Swiss banks fully digitized.

banks had to be careful not to be from the "Kodak effect" to be obtained. The U.S. giant for films had already been developed in 1975 a digital camera. The Management has also dealt in detail with the potential of the new technology and the threats to their business model. In view of the, at the time, the worse the image quality of digital images, Kodak refused to develop a strong own digital cameras.

Kodak's first digital camera for the mass market was launched in 1996 and allowed only a preview of the image on the Monitor. The photos could not be saved, but have been more exposed on Film. The Rest is known: Sony, Canon and co. have made the big business with digital cameras. In 2012, Kodak was bankrupt.

"issues a online daughter back to the mother house."Damir Filipovic, financial mathematician

so Far, has not started a Bank in Switzerland, an online offshoot. Most likely in this direction, the Bank is the App in the "Zak" of the BKB subsidiary, Cler. Financial mathematicians Damir Filipovic of the ETH Lausanne can understand the reluctance: "Because of the problems in the case of a online daughter back to the mother house. And trust remains the most important asset in banking." In France, however, the place of deer as the BNP Paribas have already responded with the Smartphone-banks, such as the Hello Bank on the competition by N26 & co..

N26 and Revolut struggle for supremacy in Europe. You follow the same approach as the Internet retail giant Amazon : the gains are a matter of secondary importance, the revenue will be invested in the Expansion, in order to get the largest possible customer base. Then higher quality products are rolled out, the are profitable.

That N26 can grow quickly, has proven to be the company was recently in the UK. The Start-up has won up in only two months, 100’000 customers.

(editing Tamedia)

Created: 15.01.2019, 19:15 PM