I admit it, from the title, and most likely from my excited writing style in the rest of this post, it will very much seem like I’ve been paid to write this by the bank. But the truth of the matter is much more mundane: I’m simply childishly excited by new toys, and my newest toy at the moment is the bank account I just opened with the new completely-online bank NUMBER26. At the moment, the service is only available to customers in Germany and Austria, but there are plans to roll out to other countries relatively soon.
This is particularly interesting for me, as it seems that in Germany the private banking sector lags behind somewhat when it comes to customer experience. In contrast to Scotland, Ireland or Austria, banks can be rather difficult about opening accounts, fees are common and not always intuitive, and most annoyingly it tends to be difficult to find and ATM where you aren’t charged for making cash withdrawals – particularly problematic in a country where cash is still very much the norm. As Romain Dillet, writing for TechCrunch, puts it:
As a reminder, commercial banks in Europe suck. In the U.S., you can show up and open an account in five minutes. They will scan your ID, make you sign a couple of documents, and you will leave with a temporary debit card. In Europe, you need to make an appointment with a bank’s local branch, bring documents, fill a lot of forms and listen to a customer representative trying to upsell you. You will waste a couple of hours.
To explain how easy opening this account was, I will treat you to a run down of my experience. First of all, I put my name down on the waiting list somewhat less than two weeks ago. I was told at the time that the wait would be about 4 or 5 weeks before I got my invite code, but that I could expedite this by inviting others to sign up. I was far too lazy to do this, so I contented myself with waiting for a few weeks. Last week I was even warned that the waiting time might be extended due to high levels of demand. As such, you can imagine my shock, when yesterday I received a friendly email from the people at NUMBER26, along with my invite code. Eager to play with my new toy (I essentially deem any new online service service, digital content, gadget, smartphone, tablet, etc., a toy, as they tend to elicit the same passionate but short-lived excitement from me that new toys used to), I realised that I would be at work too late on Thursday to set up the video-chat needed to verify my identity, but that I could do so the next day (today).
So I woke up, bright and early at 11:23am (I don’t work Fridays…), and went about setting up my new bank account. I simply clicked on the link in the email, entered my invite code and was presented with 3 options to go about verifying my identity: (1) Have a friendly video-chat over my laptop webcam with a NUMBER26 representative, and wave my passport in front of the camera to verify my identity, (2) a similar process, but involving my smartphone, or (3) a postal option which would take a few days longer. I opted for option (1), but due to the lack of light in my room (I tend to live a somewhat vampiric lifestyle on days when I’m not obliged to leave the apartment), and perhaps my useless webcam, my passport wasn’t clear enough to take a picture of, so we started the process again, but this time on my phone (option (2) for those keeping track).
This process was handy enough, after I downloaded a separate app for the verification process, involving me verifying my name, passport number, and activation code sent to me by text. The whole process from start to finish took about half an hour, and some of that time was due to my own deliberations and having to restart the process. As the NUMBER26 employee I dealt with could only see me from the neck up, I can neither confirm nor deny whether I was wearing pants during this exchange. Incidentally, their offices looked quite nice in the background from what I could see, very bright, nice picture on the wall, representative was wearing a suit, but offset by a jaunty electric-blue tie – of note to those of you looking for a job with NUMBER26. At the end I was prompted to install the NUMBER26 app on my phone, and log in on my laptop to the intuitive and consumer-support-heavy website, and told that I could finish the process completely when my shiny new Mastercard arrived and I activated it, delivered to my door within a few days of confirming my email address (at the time of writing the promptness of this claim has yet to be verified, but so far so good).
The FAQ section of the site is amusingly, but nonetheless helpfully, filled with repeated questions along the lines of “Do I have to pay and transaction fees” and “No, but seriously, NONE?”. And indeed their answer is in the affirmative. The deal is that you do not pay any monthly fees for the account, nor any transaction fees for money transfers, payments or ATM withdrawals. This could be particularly handy for people like myself, who travel a lot, or move country every couple of years, necessitating many new bank accounts and cards of various descriptions.
Even more impressively, I noticed on completing my sign up that the support team is available from 9:30am to 8:00pm, particularly handy for many people (myself included) who find banks’ traditional ‘not-open-before-you-go-to-work and closed-when-you-finish-work’ working hours less than helpful. This might in fact also have meant that I could have completed the registration and identity verification when I came home form work yesterday, thus making the process even more efficient.
The service itself gives you a whole host of useful options, many of which your current bank almost certainly won’t offer, such as; a comprehensive overview of your transactions and up-to-date balance on your phone; automatic clustering and statistics of your spending, so you can keep track of what you’re spending your money on; a host of options to search and filter through your incoming and outgoing payments; the ability to send money via email or text; and robust(-sounding) security features, such as one-click blocking of your Mastercard. One of the handiest features are the push notifications (which can also be sent as email notifications) which you can set for just about anything, such as successful or failed payments, or payments over a certain (customisable) limit.
Might NUMBER26 run into regulatory hurdles (beyond the ones they have already successfully negotiated in setting up this service)? Perhaps. Does it remain to be seen precisely how secure their online banking platform and data privacy measures are? Of course. But these are questions for another day, and you will no doubt hear from me again if I get my identity/video-game-buying-savings stolen. For the time being, NUMBER26 have managed to launch an online banking alternative which puts most established financial players to shame, and which will appeal to a lot of people.
The whole service works because of the partnership between NUMBER26 and WireCard Bank AG, which has its headquarters near Munich and is where your money is actually deposited. As the NUMBER26 FAQ page puts it:
At which bank is my money deposited when I open a NUMBER26 account?
We are working together with the Wirecard Bank AG with headquarters in Aschheim by Munich. Your account is legally held by this bank. The Wirecard Bank AG is a wholly-owned subsidiary of the Wirecard AG, which is also headquartered in Aschheim and is listed on the TecDax at the Frankfurt Stock Exchange. It has been operating internationally and domestically since 2005 with a full banking license serving both retail and business clients. The Wirecard Group operates globally and is a leading electronic payments services provider.
Why did NUMBER26 choose Wirecard Bank as their partner?
We need a strong, experienced and flexible banking partner at our side who has regulatory know-how as well as the appropriate license in order to enable us to bring our product to the European market. After talking to several potential partners, we chose Wirecard as they were best able to meet our criteria. The financial power of Wirecard (as a company listed on the TecDax with a market capitalization of roughly 4.9 billion euros) guarantees the security of our customers’ deposits.
Our product is clearly isolated from all other Wirecard products.
At the end of the day, the NUMBER26 account is unlikely to replace your primary bank account, due in part to the relatively limited account options, such as no overdraft system or interest-paying savings accounts – though this could change if the company are successful and branch out. Nonetheless, the hassle-free, fee-free, Mastercard’ed current account, and the comprehensive online support and app could mean that much of your day to day shopping, and especially financial transactions whilst abroad, could become much handier. If nothing else, this welcome bit of competition might put the wind up other banks and encourage them to get their act together and join us all in the 21st Century.
… and if you feel like signing up, here’s the link https://number26.de/en/
Romain Dillet, “Number26 Could Be The Best Banking Experience In Europe”, TechCrunch (26 January 2015), available at http://techcrunch.com/2015/01/26/number26-could-be-the-best-banking-experience-in-europe/
Ben Kepes, “Is This Banking 2.0? Number26 Launches”, Forbes (6 February 2014), available at http://www.forbes.com/sites/benkepes/2015/02/06/is-this-banking-2-0-number26-launches/
“Number26 – Revolution of Bank Accounts”, DeutschesKonto.org (23 December 2014), available at https://www.deutscheskonto.org/en/number-26/