Five months. A quarter of a million new U.S. customers.

That’s the news from Berlin, Germany-based challenger bank, N26, which announced this week that it has added 250,000 new customers in the U.S. within five months of its August launch.

Calling American consumers “too reliant on traditional banks,” N26 U.S. CEO Nicolas Kopp suggested that the wave of new U.S. customers was just the beginning. “We’re incredibly proud to have reached a quarter-million U.S. customers in our first five months and we’re just getting started. We have big plans to offer millions of future N26 users a feature-rich, easy-to-use banking experience.”

The challenger bank, which launched in the U.S. last year courtesy of a partnership with Axos Bank, offers its new U.S.-based customers a regulated, FDIC-insured account, a Visa debit card, and basic spending management tools like account activity display, daily spending limits, and automatic transaction categorization. In December, N26 introduced its Perks program for U.S. customers, giving them cashback rewards and discounts for purchases made on their N26 debit card.

N26 gives its customers the ability to open accounts in less than five minutes, transfer money to friends instantly with MoneyBeam, and leverage a tool called Spaces to open sub-accounts to manage savings goals. The accounts have no hidden fees, and accountholders have access to a network of more than 55,000 surcharge-free ATMs. Customers who sign up for direct deposit can access their pay up to two days early.

Gains in the U.S. notwithstanding, N26 points to Europe as the source of most of the growth in its customer base – which reached 3.5 million last summer and now stands at five million. N26 co-founder and CEO Valenti Stalf heralded the five million customer milestone, but suggested the achievement is only a step on the journey the company has set out for itself when it was founded in 2013. “(We) have not forgotten our original mission – to challenge an industry that is ripe for change,” Stalf said. “N26 has proved that banking can be simple and intuitive through the use of technology.”

N26 has raised more than $680 million in funding, with $470 million of the challenger bank’s equity capital coming last year.

In the past five months, the Financial Data Exchange (FDX) has brought in 25 new members including heavy-hitting industry participants such as Ally, Discover, MassMutual, and TransUnion. The recent boost brings the FDX’s total membership up to 82 organizations, a 3x membership increase since October 2018.

FDX aims to standardize financial data sharing by means of an API and technical standards that adhere to the group’s core principals: Control, Access, Transparency, Traceability, and Security.

“Working together as an industry, we provide consumers and businesses with better transparency, security and control over their financial data, while eliminating access barriers for innovators,” said Don Cardinal, Managing Director of the Financial Data Exchange. “Recently-signed data sharing agreements by our member firms are verifiable steps towards a credential sharing-free future all members are working toward.”

The unified approach will help mitigate screen scraping, a method of gathering consumer data that has the potential to compromise bank security by mimicking fraudulent activity. This, in turn, can make it difficult for banks to distinguish between the two logins. In the U.S., JPMorgan Chase became one of the first banks to stand up against the practice. The bank banned fintechs from screen scraping earlier this year.

A list of all FDX members can be found on the organization’s website.

One of the big additions to FinovateEurope (February 11-13) this year is a new initiative designed especially for fintech startups. Finovate Research caught up with Greg Palmer, Finovate Vice President, to discuss the new program, how it came to be, and what impact he hopes it will make on the broader fintech community.

Since its founding, Finovate has been synonymous with new financial innovation. But the idea has always been that you’ll take innovation wherever you find it – whether it comes from new companies or incumbents. Now Finovate is going all in new companies, fintech startups exclusively, with this new program. What’s the thinking behind it?

Greg Palmer: Finovate is still very much about taking innovation wherever it happens to come from, whether that’s from new startups, established industry behemoths, or anywhere in between, but we know it’s difficult for early-stage startups to get traction, and so we wanted to give them a little extra attention with this program. When it comes to getting a demo slot on stage, we’ll continue to look at the quality of technology first and foremost, rather than the age or revenue of the company behind it; the Startup Booster is really about giving early-stage companies some insights and connections to help them get to the point where they’re ready to stand up in front of large numbers of people and fly their flag.

What are the components of the program? What will the startup companies actually do?

Palmer: We’re still in the first iteration, so this will likely continue to evolve as the program grows, but there are really three primary components to it. The first is that we’ll be offering a dedicated track onsite at our events with information that is specifically relevant to new startups. In that track, we’ll cover things like how to scale up, how to put together a convincing pitch, etc. We’ll follow up that informational session with a condensed networking session, giving attendees a chance to connect with early stage companies and learn about what they do. Finally, we’ll continue to follow up with the companies that participate after the events, with a series of webinars and learnings, so the program doesn’t end just because the event is over.

What do you hope companies participating in the program will gain from it? How do you think it will help the fintech community as a whole?

Palmer: The first thing that companies will gain from it is pretty simple – they’ll be able to come into Finovate for a substantially reduced rate, giving them a chance to see and hear it all for themselves. Beyond that, we want the companies who participate to leave with a greater understanding of what they need to do to grow to the next level along with some connections that can help get them where they want to go.

From my perspective, the industry as a whole needs to have these startups pushing the incumbents, or else the speed of innovation will slow down. Challengers play a vital role in keeping everyone else honest, and fintech has grown into what it is today because new companies have come in and pushed hard for changes. If we can help give those startups the tools and connections they need to grow, the industry as a whole should be better off for it.

Where do you hope this goes in the near future? Will there be a startup program like this for all Finovate events going forward?

Palmer: We’ve already got the Startup Booster in place for FinovateEurope and FinovateSpring, and we’ll be setting it up for FinovateAsia and FinovateFall too. Our first goal is simply to get as many companies as possible involved, and from there we want to start engaging with the group to see where we can be helpful to them. Big picture, we want to put these companies in the position where they can come back to Finovate as demoing companies and do well up there on the big stage. If we’re able to help companies get there, it’s a win for everybody – our audience will keep getting to see new, cool companies, the companies themselves will be able to show the entire audience what they can do, and we’ll get to keep being a place where the fintech ecosystem comes to connect with each other.

For more information about the Finovate Startup Booster program, e-mail us at info@Finovate.com

Here is our weekly roundup of the latest news from our Finovate alumni:

• Coda joins Temenos Marketplace to help banks integrate with accounting packages used by their small business customers.
• DocVentive joins Quadient’s Partner Advantage Program.
• Lighter Capital to sell up to $100 million in credit assets to fund early-stage tech startups.
• Tink becomes BNP Paribas’ preferred tech partner in Europe.
• Personal Capital launches Personal Capital Cash joint savings account.
• Miva partners with Signifyd for fraud prevention.
• Avaloq and atpoint team up to launch atpoint.FINAP360, a “credit highway” for mortgage and SME loans.
• Aixigo expands its presence in U.K., Italy, and Southern Europe.
• ForwardLane receives investment of undisclosed amount from SEI Ventures.
• Illuma Labs wins top honors at VentureTech 2019.
• Fenergo launches e-KYC Connect to allow banks to make their KYC services more efficient.
• InComm partners with instant ticket expert Pollard Banknote to launch ScanACTIV, a tool for lotteries to merchandise instant tickets at retail locations.
• ACI Worldwide selects The Bancorp and Visa as payment providers for corporate disbursements.
• TickSmith’s core software platform, TickVault, is now known as the GOLD platform.
• Creatio wins Gold in One Planet award for helping companies accelerate growth.
• AxeTrading integrates Overbond’s COBI pricing analytic platform.
• Temenos Infinity and Transact now help new U.S. digital banks go live in 90 days.
• Worldpay partners with Flutterwave to power payments in Africa.
• Backbase opens regional headquarters in Singapore.
• Habib American Bank implements the Commercial Lending Center Suite from Jack Henry’s ProfitStars.
• TONIK selects Finastra’s core banking solution to power its Southeast Asia-based, licensed digital bank.

Alumni Features and Profiles

Persistent Systems and ValidSoft Team Up to Enhance Voice Authentication – The two companies are working together to develop a digital voice authentication solution that integrates into Persistent Systems’ banking offerings.

SoFi Teams Up with Mastercard to Boost Benefits for Members – Courtesy of a new partnership, SoFi members will have access to a new range of products and in-person experiences – including a new fan experience for visitors at SoFi Stadium in Los Angeles, California. 

Accenture Taps the Blockchain for New Procurement Platform – Consulting and technology services company has launched a new procurement solution today called the True Supplier Marketplace. The new tool taps into the blockchain to more efficiently connect buyers and suppliers.

Our latest series of FinovateEurope Sneak Peeks are up. Meet Qplatform, iProov, Apiax, Efigence, Subaio, FinTecSystems, Scientia Consulting, ReceiptHero, and ARM Insight.

FinovateEurope Alums Reel in $940 Million in 2019 – With FinovateEurope less than a month away, we thought we’d take a look at some of the fundraising success the conference’s alums had in 2019.

How Trusona Stops the Funding of Evil – If you’ve ever been hacked, having either money or personal credentials stolen, did you stop to think about what type of person, organization, or agenda you were inadvertently supporting?

Also on Finovate.com

How to Engage the Customer in an AI-First World – Which digital technologies will make the biggest differences in shaping the customer experience in the new decade?

Vive Lands Banking License – Challenger bank Vive Bank received some good news from the Bank of England today. The U.K.-based startup has been granted a banking license with restrictions.

Lift Every Voice: Fintech’s Other Diversity Challenge – When the discussion of diversity in the tech world comes up, the conversation is typically oriented around gender diversity. But diversity along ethnic lines is also a goal that technology companies have increasingly begun to strive toward.

Fintech Challenger Bank Qonto Raises $115 Million – Vive la France, indeed! One week after French payment app Lydia announced a $45 million fundraising, neobank Qonto reports that it has just closed the largest funding round to date for a French fintech.

AvidXchange Secures $260 Million in New Capital, Earns $2 Billion Valuation – Does fintech have its first “double unicorn” of 2020?

Paga Acquires Apposit, Announces Geographic Expansion – Mobile money operator Paga is poised for growth. The Nigeria-based fintech acquired U.S. software company Apposit and announced plans to expand its services geographically.

Japan’s Digital Yen; Visa, Plaid, and the Opportunity for African Fintechs – Finovate Research has been busily putting together a variety of features looking at different issues surrounding fintech in Europe. These insights will be published in an upcoming special supplement; stay tuned for our celebration of and reflection on PSD2’s second birthday, our look at venture capital’s impact on the surging challenger bank movement, and more.

Vive la France, indeed! One week after French payment app Lydia announced a $45 million fundraising, neobank Qonto reports that it has just closed the largest funding round to date for a French fintech.

French challenger bank Qonto has raised $115 million (€104 million) in Series C funding. The round was led by Tencent and DST Global, and also featured participation from existing investors Valar and VC Alven. Two angel investors, Taavet Hinrikus (TransferWise co-founder) and Ingo Uytdehaage (Adyen CFO), were also involved in the financing. Qonto now has raised a total of more than $150 million (€136 million) in capital.

The company will use the funds to fuel its expansion into three new markets just entered in 2019: Italy, Spain, and Germany. The investment will also help Qonto strengthen its position in France where the majority of its 65,000 SME and freelancer customers do business. The funding will help the company grow its headcount from 200 to 300 within a year, and help Qonto secure a credit institution license by year’s end that will allow it to become a bank.

Investors in the firm credited Qonto for its ability to efficiently provide financial services for an underserved sector such as freelancers. Managing Partner for DST Global Tom Stafford praised the company for “using technology to change banking for small and medium size businesses from a source of friction to a source of competitive advantage.”

Founded in 2017, Qonto offers freelancers and SME business owners a range of financial services from streamlined account opening and expense management to real-time notifications and visibility into cash flow. The company was named one of the “hottest startups in Paris” by Wired U.K. last August.

Challenger bank Vive Bank received some good news from the Bank of England today. The U.K.-based startup has been granted a banking license with restrictions.

Vive is aiming to ship its offerings in the second quarter of 2020 but unlike the region’s other challenger banks, Vive Bank will not be launching a current account. Instead, Vive Bank will focus on unsecured personal loans, a fixed-rate savings account, and PFM tools.

“It’s just not difficult to get a current account, so we want to focus on serving our customers with what they really need,” Vive CEO Nick Anthony said in an interview with AltFi. “We’re looking to serve a market where it’s more difficult for customers to get banking products. We want to make it simple and straightforward. Our unsecured personal loans, for example, will be far more than the narrow offering from high street banks, aimed at helping those with less than perfect credit scores.”

Vive Bank was founded in 2017 and has since refrained from promoting its services. While a waiting list is available on its website, the startup has intentionally remained quiet until today.

The new digital spending account from Canadian fintech Mogo does more than help Canadians get control of their finances. The solution – which also comes with a Mogo Visa Platinum Prepaid Card – also offers cardholders generous cashback rewards and a way to make a positive impact on the environment by reducing their carbon footprint.

“With MogoSpend,” company founder and CEO David Feller explained, “our goal was to create a product that gives consumers even more control than a debit card and with cashback rewards that rival the best credit cards in Canada, without charging monthly or annual fees, and importantly, we wanted to make this a card that also help make a positive impact on the planet.”

Feller noted that 57 percent of Canadians carry credit card debt, which he connected with the problem of overspending. This, according to Feller, leads to overconsumption which he said was “directly linked to climate change.” He added, “Being more mindful around spending can help us achieve important life goals like buying a home and retirement, and many of us are becoming increasingly aware that being a mindful consumer is key to a healthy planet.”

MogoSpend is accessible via Mogo’s iOS and Android app, and can be set up in less than three minutes. The free service has no monthly or annual fees, works like a checking account, and enables users to instantly transfer funds from their bank account to their MogoSpend account. MogoSpend gives 1.5% cashback on domestic purchases and 3% on international currency purchases. Users can see how much cashback they have earned on the app in real time, and those funds are credited to the users account on a monthly basis, rather than at year’s end.

The only payment card in Canada to offer a carbon offset program, MogoSpend will offset one pound of CO₂ for every dollar MogoSpend users spend using the card. The program comes courtesy of a partnership between Mogo and Canadian sustainability and carbon-management solution provider, Offsetters.

Mogo will make the new offering available to members on its waiting list “in the next few months.” Those interested can join the waiting list by downloading the free Mogo app and opening an account.

If your insurance company is offering you drone insurance, you know it’s not your grandmother’s insurance agency. Germany-based insurtech Getsafe does just that– and the company announced today it is expanding its home contents insurance offering (though, sadly, not its drone insurance offering) to users in the U.K.

Starting today, U.K. users will have access to Getsafe’s “neo-insurance” offering via its mobile app. The launch is made partially possible via a partnership with Hiscox, which will serve as the carrier for Getsafe’s U.K. contents product. The fintech’s other insurance partners include Munich Re and AXA.

Getsafe’s selection of the U.K. as its next launch site is a strategic one since U.K. residents are already comfortable with mobile-based services and payments. In fact, the U.K. is one of the leading regions of the globe for challenger banks.

The company has already proven itself as the fastest growing insurance agency for millennials in Germany. “Over the last two years, we have shown that our product meets a core need for the young, tech-savvy generation,” said CEO and founder Christian Wiens. “With our insurance delivered through your smartphone, we are developing a product that fits perfectly with the living and communication habits of this generation.”

Getsafe states that today’s move into the U.K. is “just the beginning.” The company plans to expand its offerings to all of Europe in the next few years.

Getsafe has raised $17 million and was founded in 2015. In addition to its contents and drone insurance products, the company offers ad-hoc insurance for travel, liability, bike theft, legal protection, routine care, dental care, and dental replacement. Getsafe also has plans to launch a digital life insurance company in Germany, its flagship market.