Europe’s Newest Digital Bank
Northmill, a Fintech based in Stockholm, Sweden, has just received a banking license from the Swedish Financial Supervisory Authority (SFSA or Finansinspektionen). Northmill was founded in 2006 and is “building the bank of tomorrow.”
According to a blog post, Northmill applied for a license to conduct banking operations in late 2017 and has since worked closely with the SFSA regarding the company and future strategy as a bank.
Northmill said it will commence its banking operations soon by adding saving accounts, cards, and payments transfer to its existing customer offerings.
Currently, Northmill operates under the supervision of the SFSA as a consumer credit institute and registered payment service provider. Northmill also offers an Insurtech feature with two products: Rebilla Reduce and Rebilla Reward.
Launched last month, Rebilla is “payment protection insurance (PPI),” or “loan insurance.”
Northmill’s insurance business is reported to have over 15,000 monthly policyholders.
Northmill stated that it must have an initial capital of a minimum of € 5 million to launch its banking services. Furthermore, Northmill must at all times have a capital base of no less than the initial capital. Northmill must also hold a capital buffer to reduce the probability to fall below the capital requirement.
Margareta Lindahl, Chairwoman of the Board at Northmill, commented on the announcement:
“This is a natural part of Northmill’s continuous journey and another important step in our mission to simplify people’s financial lives through technology and innovation. We believe this enhances our opportunity to continue to develop and offer great products to customers all around Europe. The banking license means a great responsibility and it is gratifying to see that Sweden and its authorities foster innovation. By being technology-driven and product-oriented we are excited to be able to build a new modern customer-centric bank. Northmill has grown organically and laid a solid foundation with our current credit and insurance offerings to our 200 000 users. The most recent product, Rebilla Reduce, aims to lower people’s current interest rate on existing credits. By being able to operate as a bank, we have the tools to take the next step and drive true positive change for the users.”
Digital banking is a robust sector of Fintech with multiple European entrants experiencing rapid growth. As Sweden is an EU member state, the bank license should help Northmill passport services across Europe.