Amsterdam-based challenger bank bunq is all set to change the traditional banking industry. For the first time, bunq has raised external capital in July this year and now, DNB (De Nederlansche Bank) has approved €193 million (nearly $219 million) in a funding round between bunq and a British private equity firm – Pollen Street Capital.
With this round, bunq is valued at €1.6 billion (nearly $1.8 billion). Also, it marks the largest Series A investment to be secured by a European fintech company.
The challenger bank will deploy the funds to fuel its growth across Europe. In 2021, bunq introduced German, French and Spanish IBANs and opened offices in Cologne and Paris. Also, the bank plans to double its team by the end of next year. The investment will let bunq to M&A into its growth strategy.
Self-funded challenger bank
Ali Niknam, a serial entrepreneur founded bunq in 2012 after securing the first European banking permit. Until 2021, he self-funded the challenger bank. To date, he invested €98.7 million (nearly $112 million) in the company. Apparently, bunq had the independence and freedom to build a bank focusing on the needs and wants of users.
2021 has been a milestone for bunq as it surpassed the €1 billion user deposits in April this year. Also, July was its first-ever profitable month.
Currently, Bunq is available in 30 European countries including the Netherlands, Austria, Germany, Italy, France, Spain, Belgium, Bulgaria, Ireland, Croatia, Czech Republic, Republic of Cyprus, Denmark, Finland, Estonia, Greece, Latvia, Hungary, Lithuania, Malta, Luxembourg, Poland, Romania, Portugal, Slovakia, Sweden, Slovenia, the United Kingdom, Iceland and Norway.
Acquisition of Capitalflow Group
As a part of the deal, bunq made its first acquisition by buying the Irish lender Capitalflow Group. Previously, the company was owned by Pollen Street Capital. It is a digital specialist business lender that provides flexible finance options to those companies that intend to grow and scaleup.
Also, the company collaborated with Paysafe, a London-based payments platform to let customers access cash services. From now on, those customers using cash can add it into their bunq account using Paysafecash. This partnership will be taken to 21 countries in europe to help facilitate direct cash deposits via the bunq app.
In the bunq app, users need to choose Paysafecash as the top-up method and select the amount that has to be deposited into their account. A unique barcode will be generated for the transaction.
Once this is done, customers can visit a nearby payment point and make the payment by scanning the barcode at the PoS terminal. The cash that is deposited will be seen on the bunq balance in a few minutes.
bunq offers a slew of features
The Dutch challenger bank offers a slew of new features for its users. These include debit reminders that send the reminders a day before the due date, Auto accept, which sends direct debits and payment requests from reliable contacts, All subscriptions that reminds when a subscription is all set to expire, Tailored support for a good in-app experience, Top-up notifications while receiving funds, and a new search function.
In October, bunq announced the launch of a new ‘Local Currency’ account, which helps users receive, convert, hold, and spend various currencies easily. As the travel restrictions are easing worldwide, bunq hopes this account will help travellers and remote workers to carry out their banking and financial needs.
Focuses on sustainability
bunq is among the few challenger banks, which focus on the green mission. Last year, the challenger bank introduced the Green Card, which is a metal card that plants a tree whenever users spend €100. The more the users spend, the more trees bunq will plant. In two months of launching this card, the bank planted over 40,000 trees. The Green Card is ideal for the planet as it is made using metal, which has a 50% longer life than plastic cards.
API marketplace for developers
bunq launched a marketplace for developers last year to showcase apps developed using its open API. bunq is the first bank to come up with a marketplace presenting apps that are built on its platform. Via this platform, app developers can market themselves to the users of bunq. Also, the users of the challenger bank can access various apps to track their spending habits, manage their online banking credentials and more in just a click.