- Germany’s financial regulator has lifted a cap on the number of new clients that N26 Bank AG can take on after the fintech company improved its anti-money laundering controls.
- The cap, which restricted N26 to accepting only 60,000 new clients per month, will be removed entirely from June 1, 2024.
- N26 CEO Valentin Stalf said, “We are pleased about the trust of our regulators and will continue our close exchange in the future. In recent years, we have been able to make significant progress in preventing and combating money laundering and financial crime.”
N26 Bank AG can now onboard an unlimited number of new clients, following regulatory approval of its enhanced anti-money laundering measures.
Regulatory Approval and Enhanced Measures
Germany’s financial watchdog BaFin has lifted the cap on new clients for N26 Bank AG, effective from June 1, 2024. This decision follows significant improvements in the bank’s anti-money laundering (AML) controls. N26, a prominent fintech company known for its user-friendly mobile banking solutions, had previously been limited to onboarding 60,000 new clients per month due to regulatory concerns.
Investment in Compliance and Technology
N26 has invested over €80 million to meet stringent AML standards and has implemented modern, intelligence-based technology to detect and combat fraud and money laundering in real-time. Co-CEO and COO Maximilian Tayenthal emphasized the bank’s commitment to pioneering AML efforts among European banks. “Our infrastructure and our use of modern, intelligence-based technology enable us to detect and combat fraud and money laundering in real time. We want to play a pioneering role among European banks in this field over the next few years,” Tayenthal stated.
Past Regulatory Challenges
The lifting of the cap comes after a series of regulatory challenges for N26. In 2022, BaFin imposed a €9.2 million fine on the bank for systematic delays in filing reports of suspected money laundering. The bank has since addressed these issues and committed to full compliance with BaFin’s orders. Earlier, in 2021, BaFin fined N26 €4.25 million for lax AML controls and temporarily limited the number of new customers the bank could onboard each month.
Future Outlook
With the cap lifted, N26 is poised for renewed growth in its key European markets, including Germany, France, Spain, and Italy. The bank’s focus on regulatory compliance and technological innovation positions it well for future expansion. As N26 continues to enhance its AML measures, it aims to set new standards in the fintech industry, ensuring robust protection against financial crime.
Conclusion
The removal of the client cap marks a significant milestone for N26, reflecting the bank’s progress in strengthening its AML controls. With substantial investments in compliance and technology, N26 is well-positioned to lead in the European fintech space, offering secure and innovative banking solutions to a growing customer base.
