N26 loses 172 million in 2021, 14.4% more, due to higher investments and raises revenue by 67%

MADRID, 11 Oct. (EUROPA PRESS) -

N26 increased its losses by 14.4% in 2021, to 172.4 million euros, due to the significant investments made during the year, although it increased its net income by 67%, to 120.3 million euros, according to informed this Tuesday in a press release.

The online bank of German origin has highlighted that the revenue margin continued to grow in 2021, "even when investments in talent, product and platform scalability, and online fraud prevention measures increased significantly".

As he explained, N26 maintained its focus on increasing recurring customer activity and consolidating its position as "the leading online bank in its key markets". Both this and increased investment in product development and expansion of the subscription offering drove deposit growth and customer retention in 2021.

Thus, the volume of transactions grew by 59%, to 80,000 million euros, and customer deposits registered an increase of 52%, reaching 6,100 million euros. N26 grew its user base by more than 1 million to 8 million customers, of which 3.7 million bring in significant revenue.

On its side, expenses grew by 30.8%, to 269.88 million euros, both due to the rise in administrative expenses (47%) and personnel expenses (10.7%).

As explained by N26, the increase in administrative expenses responded to "significant investments" aimed at further strengthening regulatory frameworks, including systems and personnel to strengthen the company's key business functions. Likewise, provisions for risk increased by 80.9%, to 16.1 million euros.

All in all, the net result for the year was negative, 172.4 million euros, compared to the losses of 150.7 million recorded a year earlier (14.4%).

The CEO and co-founder of N26, Valentin Stalf, explained that, during 2021, the bank invested heavily in its products and equipment, as well as in the scalability of its platform. "On average, customers log into their N26 app three times a week, making us the mobile bank with the most active customer base in Europe. This was reflected in a notable increase in transaction volume ", has explained.

For his part, the general director and financial director of N26, Jan Kemper, has affirmed that the entity has continued to lay the foundations for "sustainable growth". "Our annual revenue increased and the customer base with 'premium' subscriptions grew considerably. We also saw a significant increase in deposit volumes, which opens additional revenue streams that will make us even more resilient in the future", has pointed.

It should be noted that, at the end of 2021, N26 closed a Series E financing round of €700 million, valuing the company at more than €7.7 billion.

"After closing a historic Series E financing round in October 2021, the company is in an excellent position to maintain the positive momentum of the previous year. With the constant expansion of its revenue streams, the resilience of the bank's business model online comes out stronger, despite the uncertain macroeconomic environment," the entity said.

On the other hand, in November 2021 it announced its exit from the US market to concentrate its efforts on Europe. According to him, his medium-term internationalization strategy involves continuing to grow in key European markets, mainly Germany, France, Italy and Spain.