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In this modern day and age, even the banking systems that we have grown accustomed to are now shifting their methods of operations to keep up with the latest tech developments. Challenging the traditional notion of banking is the Swedish fintech firm Northmill, which provides cloud based financial services. The company has now received a banking license from the Swedish Financial Supervisory Authority (SFSA) and is all set to soon offer banking operations.
Northmill currently offers a host of financial services and Rebilla is its consumer-focused product that is the highlight. Users who have a partial payment, credit or a credit card bill between 1,000 and 300,000 kronor can avail the service as the company pays off their debt to the existing creditor to offer lowered repayment option. With the new banking license, Northmill will soon add saving accounts, cards and payment transfer to its existing services.
”Northmill has grown organically and laid a solid foundation with our current credit and insurance offerings to our 200,000 users. The most recent product, Rebilla Reduce, aims to lower people’s current interest rate on existing credits. By being able to operate as a bank, we have the tools to take the next step and drive true positive change for the users.” says Margareta Lindahl, Chairwoman of the Board at Northmill.
Northmill applied for a banking license back in 2017. Now, when it commences is banking and financing operations, the company needs to have a minimum initial capital of €5 million. In addition, it should, at all times, have a capital base that doesn’t dip lower than the initial capital. Northmill also needs to hold a capital buffer for reducing the probability of falling below the capital requirement. “The banking license means a great responsibility and it is gratifying to see that Sweden and its authorities foster innovation. By being technology-driven and product-oriented we are excited to be able to build a new modern customer-centric bank,” Lindahl adds.
With a banking license, Northmill now joins the ranks of growing cloud operated fintech companies that offer banking services. The company will now compete with Germany based N26, UK based Revolut and London-based Monzo. The three companies have web and mobile based services and offer banking services to its customers. The N26 Group commenced operations in 2013 and as of January 2019, its estimated valuation stands at €2.38 billion. The company aims to make your financial life easier by offering ‘All-in-one’ banking with ‘Zero’ hidden fees and other banking services.
As for the UK-based fintech startup Revolut, it offers multiple banking services like get a mobile-based current account that allows one to exchange, transfer and hold without any additional fees. Alongside money transfers, the company also lets people exchange cryptocurrencies. Similarly, Northmill will also compete with Monzo, the London-based digital-only bank platform. Back in June, Monzo secured a €126 million in funding and had a valuation standing at over €2.2 billion.
How do you think Northmill will fare amidst such fierce competition? Let us know your thoughts in the comments below.
Image credits: Northmill
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