Finance
Dutch neobank Bunq hopes to secure the British banking license this year
Dutch digital bank Bunq is planning a return to Britain to tap into a ‘large and underserved’ market of around 2.8 million British ‘digital nomads’.
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PARIS – Dutch digital bank Bunq hopes it will be able to secure a banking license from British financial regulators later this year or early next year, the company’s CEO and founder Ali Niknam told CNBC.
“I’m hoping we’ll get somewhere by the end of the year, maybe early next year, because the British processes might be a little different to those in Europe because it’s a different regulatory area,” Niknam said in an interview on the Viva last week Tech conference. in Paris.
“I don’t know when they’re going to say yes, but so far I have little reason to believe we won’t be successful.”
Bunq, known for its rainbow-colored maps and a focus on so-called ‘digital nomads’ who are not tied to one country or location, first launched in Britain in 2019. But the bank was forced to leave the country at the end of 2020 because of Brexit.
The passage of Brexit into law meant that EU-based financial institutions could not rely on their own country’s permission to operate in the UK market. Currently, Bunq only has a banking license with De Nederlandsche Bank.
Challenges of re-entering the UK market
Now Bunq is planning a return to the British market. The company applied to the Financial Conduct Authority for an electronic money institution license last year. It says a UK launch would allow it to tap into a “large and underserved” market of around 2.8 million UK digital nomads.
Although that will prove difficult. Rival European fintech Revolut, which is based in Britain and currently holds an electronic money institution license, has been trying to secure its UK banking license for several years.
To be fair, a banking license is different from an e-money license. The main difference is that a banking license gives companies permission to offer loans. Monzo and Starling are among the few UK consumer fintech platforms to have their own banking licenses.
“We are working as hard as we can, the UK regulator has been very responsive, the dialogue is ongoing, I don’t know how long it will take, but things seem to be moving,” Niknam told CNBC.
Founded in Amsterdam in 2012 by Dutch tech entrepreneur Ali Niknam, Bunq has since grown into one of Europe’s largest neobanks overall, with 12.5 million users across Europe and deposits of 8 billion euros ($8.6 billion). ). It was last valued privately by investors at 1.65 billion euros.
Earlier this year, Bunq reported its first full year of profitability, with a net profit of EUR 53.1 million in 2023. Bunq is also aiming to expand in the United States, having previously applied for a US federal banking charter in April 2023.
