# Dutch online bank Bunq applies for U.S. banking licence
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-04-04
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: European Banking Start-Up Bunq BV Files for U.S. Licence
Meta Description: European online banking start-up Bunq BV applies for U.S. banking licence, targeting European expatriates and businesses in the U.S. As competitors struggle,
URL: https://financedigest.com/dutch-online-bank-bunq-applies-for-u-s-banking-licencehtml

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By Toby Sterling

AMSTERDAM (Reuters) – Bunq BV, a prominent European online banking start-up, formally filed for a banking licence with U.S. regulators on Tuesday, the [company’s CEO](https://www.financedigest.com/in-listening-mode-new-bayer-ceo-keeps-open-mind-on-company-split.html "In listening mode, new Bayer CEO keeps ‘open mind’ on company split") told Reuters in an interview.

Ali Niknam, the Canadian-Dutch entrepreneur who founded Bunq in 2012, said his bank is attracting depositors in Europe [despite](https://www.financedigest.com/seven-out-of-ten-uk-adults-aged-25-44-never-seek-advice-on-dealing-with-debts-despite-depending-on-the-bank-of-mum-and-dad.html "Seven out of ten UK adults aged 25-44 never seek advice on dealing with debts despite depending on the bank of mum and dad") jitters following the collapse last month of Silicon Valley Bank in the U.S.

“When things are bad, that’s the best time for us,” he said. “That’s when people reconsider their choices, which is precisely the moment we need to get a foot in the door.”

An expansion to the U.S. would help Bunq, which turned a 2.3 million euro ($2.50 million) profit for the first time in the fourth quarter of 2022, [grow more quickly](https://www.financedigest.com/4-strategies-for-quickly-growing-your-startup.html "4 Strategies for Quickly Growing Your Startup") after years of investing in its software and operations.

Bunq [raised $228 million](https://www.financedigest.com/ride-hailing-app-cabify-raises-110-million-for-expansion-in-latam-spain.html "Ride-hailing app Cabify raises 0 million for expansion in LatAm, Spain") at a $1.9 billion valuation in 2021.

Niknam said the bank’s U.S. target group will be the 5 [million European](https://www.financedigest.com/collegiate-ac-and-shuman-capital-launch-e300-million-european-student-living-fund.html "Collegiate AC and Shuman Capital launch €300 million European Student Living Fund") expatriates and European businesses operating in the U.S.

Speaking from personal experience, getting a [bank account](https://www.financedigest.com/are-banks-ready-for-the-new-accountability-regime-in-2016.html "ARE BANKS READY FOR THE NEW ACCOUNTABILITY REGIME IN 2016?") in the U.S. as a European citizen is a headache,” he said.

Bunq, which competes with Britain’s Revolut and Germany’s N26, said that as of March 14, it had deposits of around 2.3 [billion euros](https://www.financedigest.com/europes-spend-on-energy-crisis-nears-800-billion-euros.html "Europe’s spend on energy crisis nears 800 billion euros"), up 27% from 1.8 billion euros at the end of 2023.

Revolut is also seeking a U.S. licence, while N26 of Germany gave up trying to get into the U.S. market in 2021.

Niknam said the influx of depositors was mostly because Bunq offered better interest on deposits than traditional banks, but also beause people are opening additional accounts at Bunq to ensure they fall within [European deposit insurance limits of up to 100,000 euros](https://www.financedigest.com/dollar-outshines-euro-sterling-amid-european-bank-jitters.html "Dollar outshines euro, sterling amid European bank jitters").

Bunq offers savers in its native Netherlands 1.56% interest on deposits, a percentage point above rates offered by the three [big banks](https://www.financedigest.com/big-banks-can-be-challengers-too.html "Big banks can be challengers too") that dominate Dutch banking, ING, ABN Amro and Rabobank.

Bunq makes some mortgage loans but keeps more than half of its reserves at the [European Central Bank’s](https://www.financedigest.com/ecbs-villeroy-rate-hike-signals-strong-confidence-in-european-banks.html "ECB’s Villeroy: rate hike signals strong confidence in European banks") deposit facility, which Niknam said should reassure depositors.

The company’s business model resembles that of “freemium” software, [offering users a free savings account with limited](https://www.financedigest.com/credit-suisse-54-billion-lifeline-offers-limited-respite-to-global-banks.html "Credit Suisse  billion lifeline offers limited respite to global banks") features, and more advanced features with a monthly subscription costing from 3 to 18 euros per month.

($1 = 0.9199 euros)

(Reporting by Toby Sterling; editing by Barbara Lewis)


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