N26 will include Bizum among the tools available to its consumers in Spain. According to El Pais, N26 already has 900,000 users in Spain and 320 employees. As cited in EL PAIS, a representative for N26 Portugal and Spain states this is a significant milestone for the bank, and the goal is to attract new clients while retaining those they already have. Bizum is an instant payment system that connects mobile phone numbers to bank accounts. N26 had been negotiating this inclusion in its operations for consumers possessing a Spanish IBAN.
Bizum can be found in the app of any of the affiliated banks, however, users can also download the Bizum app itself. In order to send and receive money, users simply have to enter the mobile phone number of the recipient from their list of contacts and specify the amount. Additionally, customers can use Bizum for online payments by selecting the ‘Pay with Bizum’ option, indicating their phone number, and confirming the operation.
The instant payment system Bizum has 21 million users and has processed approximately 1,300 million transactions since its establishment in 2016. Furthermore, 37,000 firms have already utilised this technology as an additional payment option in their operations.
This inclusion, however, does not mean that N26 will become a shareholder in Bizum. Instead, N26 will migrate its instant payment systems. N26 representative confirmed that this technological and operational process had taken time. The bank will pay a charge in return for incorporating the service, although the amount has not yet been disclosed.
Current stakeholders of Bizum
Participation in Bizum is divided among the large financial groups in Spain. CaixaBank, Banco Santander, BBVA, and Sabadell are the only ones that possess more than 10% of the capital. Between the four they hold almost 75% of Bizum. Corporations such as Unicaja , Kutxabank, Ibercaja and Bankinter, among others, have less significant holdings. N26 is becoming the first neobank to offer the benefits of operating with Bizum.
This technological expansion in Spain comes almost half a year after the Bank of Italy banned N26 from onboarding new clients in March 2022. This came after 2021 checks flagged N26 for money laundering risks, which also resulted in a prohibition from offering new products and services, such as crypto assets, to existing clients in Italy. Currently, N26 is still planning to be prepared for an initial public offering (IPO) by the end of 2022.
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