The bank raised more than $900 million (€775 million) from private investors. N26 called it the “largest financing round to date for a digital bank in Europe” that brought the Berlin-based startup’s valuation “to more than $9.0 billion”.
“With our fresh capital, we are in pole position to become one of the biggest retail banks in Europe, all without a single branch,” Valentin Stalf, CEO and co-founder of N26, said in a statement.
The bank plans to add another 1,000 staff to its workforce of 1,500 people worldwide. The new hires will be focused on product, technology and cybersecurity, it said.
Founded in 2013, N26 offers free, online-only banking services and is one of Germany’s most high-profile financial technology or “fintech” firms.
It now has seven million customers in 25 countries.
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Its rapid growth has rested in part on fast-track identity procedures for new customers.
But N26 has been in the crosshairs of Germany’s finance watchdog BaFin since 2018 after a German news media investigation found that it was possible to open account with forged IDs.
BaFin has repeatedly ordered the bank to step up its internal controls and slapped the company with a 4.25-million-euro fine in June.
N26 said the fine was in connection with around 50 “suspicious transactions” linked to money laundering between 2019 and 2020.
The company said it reported the suspicious operations to BaFin too late for them to be properly examined.
N26 says it has since put in place measures aimed at improving the disclosure of suspicious activities.
“N26 is taking its responsibilities in the fight against the growing threat of global financial crime,” it said last month.
In Monday’s statement, N26 added that it had agreed with German regulators to limit new customers to 50,000-70,000 per month for the time being.