Challenger banks in Spain: who’s who (and what’s their tech)
With Spanish heavyweights like BBVA and Santander making great investments in new technologies (as well as in challenger banks), and a number of banks finding inspiration in the innovators abroad, the Iberian country is looking well-placed to disrupt the “traditional banking” model.
We’ll be revisiting and updating this list on a regular basis. If you have any additions to the list, please get in touch with our editorial team.
Last updated: 05 August 2019
2Gether Global is a “collaborative banking platform” app based in Spain, now available in its home country following the launch of its open beta in January 2019.
However, it doesn’t define itself as a bank, but as a banking platform. It was founded by Salvador Casquero, Salvador Carrillo, and Luis Estrada in 2016. Its CEO is Ramon Ferraz.
The basis of the model is the 2GT token, which can be acquired through the app. Users need to hold a minimum of €10 worth of 2GT to access the services, and they get rewarded for their contribution in 2GT. When regulations allow in the future, 2Gether aims to decentralise ownership among the 2GT holders.
This coin is regulated by the Maltese authorities, as it’s the only country in the EU with blockchain regulation.
Bnc10, whose wordplay works in Spanish, Catalan and English, is based in Barcelona. It was co-founded in July 2018 by Jordi Dominguez, CEO, a long-term banker with experience in HSBC, Societe Generale and USAA; and William McCahey, COO, who has worked at Australian bank NAB and Scottish Clydesdale Bank.
Bnc10 has already opened up a waiting list for potential customers. “Welcome to the new era of banking with values and zero commissions,” it states.
It is mobile-focused, offering chat banking and WhatsApp banking through its app.
The bank doesn’t have its own banking licence, but instead is relying on a licence of an undisclosed established bank.
According to Bnc10’s CEO, Bnc10 has found a “seven-digit figure” of funding from an undisclosed investor.
Bnext is a digital and mobile bank that has openly admitted to be following the beat of UK’s Monzo.
The Bnext co-founders are Juan Antonio Rullán, CTO; and Guillermo Vicandi, CEO, who has experience at BBVA and ING.
By 2017, the bank had under ten staff, and a beta version was out on the market with 1,000 customers in Madrid and Barcelona. It also completed a Crowdcube round of €130,000, alongside a €170,000 from investment funds.
In 2018, Bnext closed a financing round of €1.5 million with the aim of reaching 100,000 active customers.
Banking Technology understands that Bnext is using a third-party licence.
Bunq is a new digital bank from the Netherlands which launched in its home country in 2015, and announced its expansion into Spain and Italy in 2018. The CEO and founder, Ali Niknam, said at the time the move to the new countries followed Bunq’s “successful growth” in the Netherlands and Germany.
In September 2014, Bunq obtained its official banking permit with the Dutch Central Bank. In November 2015, the app was available to the public.
It offers an account, through which the user can send payments to IBANs, contacts’ phone numbers and e-mail addresses, among other payments features. It also offers up to three different cards, Maestro or debit Mastercard, as well as being available for businesses.
The bank has its in-house developed core banking software and relies on a limited number of third party suppliers for its technology. Among these is Veridium, which provides the bank with biometrics software.
San Francisco-based Denizen offers the “first true global, borderless account” for expats, which allows customers to receive money in one country and pay it out in another.
Currently, the account is available to expatriates living in the US and Spain (there are plans to roll it out to more European countries).
Designed for mobile populations, the firm says its banking platform avoids international transfer fees and eliminates currency exchange fees. It comes with a debit card and a mobile app. “National borders act as barriers to the free movement of money, inhibiting individuals and limiting the potential for global commerce,” states Denizen co-founder and CEO Joaquin Ayuso (he previously co-founded Tuenti, described as “the Spanish Facebook”).
Denizen’s initial funding round was provided by BBVA Compass’ New Digital Businesses unit, which is incubating start-ups in its Silicon Valley-based fintech lab. BBVA Compass also underpins the banking services of Denizen.
EVO Banco is a Spanish bank based in Madrid, created by NCG Banco in March 2012. As part of its launch campaign it introduced its main financial product: “The Smart Account”.
The following year, NCG Banco sold the EVO Banco division to a US private equity firm, Apollo Global Management, for €60 million.
In 2018, Spain’s Bankinter bought EVO Banco. Since then, it has become the testing grounds for Bankinter, as well as a new channel to target younger demographics.
It is understood that Bankinter’s online portal Coinc will be integrated with EVO’s mobile app, which has now also fully launched a smart voice assistant.
Ferratum Bank launched to the public in 2016 in Germany, Sweden and Norway. In 2017 it entered France and soon after, Spain.
A subsidiary of Helsinki-based Ferratum Group, the bank is licenced by the Malta Financial Services Authority.
Its CEO is Jussi Mekkonen, who comes from Nordea Bank.
The bank says it uses behavioural data analysis to generate intelligent, real-time and targeted recommendations to improve customer experience and add services over time according to users’ preferences.
In early 2016, CaixaBank, one of the biggest banks in Spain, launched imaginBank – a mobile-only bank that uses social media (Facebook, Twitter etc.) to connect with its customers.
The core product is the imaginBank current account (with a Visa debit card), which is commission free and allows customers to manage personal finances and make transfers and P2P payments. It supports free money transfers to any account in Spain, regardless of the bank they are held at.
Small transfers between individuals can be made without having to enter account numbers; instead, the recipient’s mobile number or e-mail can be used. Money can also be sent to a CaixaBank ATM, with customers then able to make a withdrawal without taking their card with them.
In 2017, imaginBank added a chatbot to its app to help millennials find offers and promotions most relevant to them, based on their preferences or location.
Not technically a bank, this is Orwell Group’s “pan-European” digital banking service, designed to operate in open architecture. Its CEO is Spanish-born Carlos Sanchez, who founded the firm in 2015.
A single entity covers all the EU and beyond at the same time, offering current/business accounts and cash management services (payments, FX, budgeting, cash pooling, advance payments and merchant services).
It launched in Spain in June 2017.
The firm is an IBAN issuer in the Spain, as well as UK, France, Italy and is planning an expansion in Germany, Portugal, Poland and other European and American countries over the next few years.
The firm says it plans to open its APIs to become a Bank-as-a-Service (BaaS) to any company willing to develop new interfaces or applications “to serve specific market needs”.
It is also the channel through which saving and lending banks and other financial services providers can distribute their products.
The digital banking service has gone into administration as reported on 05 August 2019.
In 2015, Monese launched in the UK as a mobile banking service. It was made available to 19 other European countries in June 2017, including Spain.
It was founded by Norris Koppel, an Estonian expat in London, and it last secured $60 million in capital in a Series B in September 2018.
In October 2018, it launched its Monese Business account in the UK, available in 11 languages, and started progressively releasing it throughout the Eurozone – and is now available in Spain too.
Germany-based challenger bank N26 offers its services in Spain, alongside any other country in the Eurozone except Cyprus and Malta.
It offers a free basic current account and a debit Mastercard card to all its customers, as well as a Maestro card for its customers in certain markets. Additionally customers can request overdraft, investment products, and premium current accounts.
N26 was founded by Maximilian Tayenthal and Valentin Stalf, and opened for business in 2016, under the name Number 26 and operating through a third-party licence. In early 2019, it raised $300 million in a Series D funding round, bringing its valuation to $2.7 billion. The new investment will fuel the bank’s plans to launch in the US.
The bank aims to have over 100 engineers by the end of 2019, and for this it set up a second European office in Barcelona.
For its underlying technology, N26 uses Mambu’s flagship core system, provided on a Software-as-a-Service (SaaS) basis.
Nomo Banking is a new digital banking service, native to Spain, catering for freelancers and the self-employed.
The bank is a project by Banco Sabadell, which launched in October 2018, aimed at attracting and using investments by Sabadell’s venture capital arm, Innocells.
Its CEO is Xavier Capellades, who is a professor at the Zigurat Innovation and Technology Business School in Barcelona.
The bank offers a mobile app for round-the-clock working hours, automatic accounting and tax management. It also offers a card that is linked to customers’ other cards.
To top it all off, the bank includes a marketplace with partnerships like Raisin, iSalud.com, and others.
Openbank, a subsidiary of Santander, has been around since 1995. It went through a complete overhaul and rebrand in June 2017. It operates as an independent subsidiary of Santander, with 130+ staff based in a consolidated office in Madrid.
It targets the “professionals” segment with current accounts, savings, investment/wealth management and lending products (including mortgages), debit and credit cards.
The bank has over one million clients and €6 billion in deposits.
It focuses on digital banking, but has one flagship physical branch in Madrid.
Orange Bank was originally set up in France in November 2017, after some delay, by the French telecoms firm Orange and its bank partner Groupama.
It plans to officially launch in Spain in the course of 2019.
For its technology, Orange Bank in Spain will use Mambu’s core banking system, delivered on a hosted basis.
London-headquartered Revolut was founded in 2015 and sees itself as a digital banking alternative designed for a global lifestyle. It offers fee-free spending, interbank exchange rates, free international money transfers, and different currencies in-app, P2P loans, cryptocurrencies, medical insurance abroad, and other premium features which make many of the ones before free.
Its services are available to individuals and businesses, and it originally appeared targeting European travellers.
In January 2019, it announced it would soon start issuing cards for Spanish customers.
In April 2018, it raised an additional $250 million in Series C funding, which saw the fintech valued at $1.7 billion – a five-fold increase in less than a year. In November 2018, it announced it was planning a $500 million Series D investment round – potentially led by Softbank.
The firm has said that it plans to build a global licensing team that will be responsible for securing banking, trading and credit licences, thus becoming “the Amazon of banking”.
For its technology, Revolut relies on its own in-house processing and card issuing. In early 2019, it signed with start-up regtech firm ClauseMatch to streamline management of internal policies, controls and regulatory compliance.