Two years after entering the Brazilian market, the German digital bank N26 has announced its departure
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Two years after entering the Brazilian market, the German digital bank N26 has announced its departure.
The bank's exit aligns with a strategic shift to concentrate on key European markets, where it operates across 24 countries.
This move is part of a broader trend known as the 'startup winter,' characterized by more selective and scarce funding opportunities, contrasting with the bank's previous successful $900 million Series E funding at a $9 billion valuation.
N26 had initially set its sights on the significant number of unbanked consumers in Brazil, launching with a waiting list of 200,000 and a mission to improve financial health through 'fincare'—a blend of finance and care.
Despite these efforts, N26 faced intense competition from established digital banks like Nubank and Inter, as well as traditional banking giants with their own fintech ventures. This competition, coupled with the late market entry, presented significant challenges.
Upon its Brazilian entry, N26 received authorization to operate as a Direct Credit Society (Sociedade de Crédito Direto - SCD), allowing it to offer credit using its own resources.
The bank increased its local team to over 100 employees, but recent strategic changes led to 20 layoffs in July, despite denials of a potential exit or sale.
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