Challenger bank N26 has announced it is to withdraw from the UK market. The German bank, which launched in the UK in 2018, blamed Brexit.
N26 has been operating in the UK through a European banking licence, and with the Withdrawal Agreement now passed by Parliament, that will not be possible for much longer.
Thomas Grosse, chief banking officer at N26, said: “While we fully respect the decision that has been taken, it means that N26 will in due course be unable to serve our customers in the UK and will have to leave the market.”
We reveal what this means for N26 current account holders and what they should do now.
When will UK current accounts close?
N26 isn’t shutting up shop in the UK immediately.
Instead, all accounts will be closed on 15 April. Until then they will work as usual, so Direct Debit payments will be made, and you’ll be able to make withdrawals with your debit card.
It’s only UK accounts that are affected ‒ accounts elsewhere in Europe will continue as before.
Grosse says N26 plans to continue with its mission to “radically transform the global banking industry through innovation and the power of technology and design to build a bank the world loves to use.”
That’s not much help to the 200,000 people who have less than two months to find a new home for their money, though.
Compare current accounts at the loveMONEY comparison centre
Does N26 need to leave the UK market?
It’s worth noting that even with Brexit, N26 could have continued operating in the UK.
Just because a European banking licence is no longer an option, it could have applied for a UK banking licence, which would have meant it continued offering bank accounts to Brits.
N26 obviously decided against doing this and hasn’t said why.
What was the appeal of N26?
N26 account holders have about two months to find another account to move to.
The main appeal of N26 really was the ability to spend overseas without being whacked with charges, but you would still have to pay fees when you withdraw cash abroad.
Thankfully, there is no shortage of accounts offering something similar ‒ or even better ‒ that may appeal to you.
For example, Monzo doesn’t charge a fee for spending or cash withdrawals abroad, though there is a £200 limit on those withdrawals.
It’s much the same at Revolut, another challenger bank that has seen the clear demand for cheap usability overseas as a way to stand out from the traditional high street banks.
Starling Bank offers unlimited fee-free foreign spending and cash withdrawals.
If this is a vital feature you need from your current account for you, check out our run through of the best debit cards to use abroad.
If overseas payments are not a big deal for you, then you may want to consider different accounts.
NatWest has recently launched a mammoth switching bonus, paying new account holders a whopping £175, for example. See how it compares in The best bank accounts for switching bonuses.
Alternatively, you might be really keen to get something back from all of your Direct Debits and bills that you pay through your bank account.
Check out the top contenders in The best bank accounts for cashback.
Compare credit cards at the loveMONEY comparison centre
Why you’ll need to manually switch
Frustratingly, N26 has not signed up to the Current Account Switching Service.
This is a nifty little service that ensures any switch you go for takes place within seven days, with all of the changes to Direct Debits and regular payments handled for you.
You’ll have to go for a manual switch when moving elsewhere, so it’s worth giving yourself a little extra time.
You should also be vigilant when switching your Direct Debits and make sure that anyone who sends you money are aware of your new account details as any payments sent to your N26 account after 15 April will be returned to the sender.