N26 as a case study of fintech penetration into the banking industry

Abstract

Using breakthrough technology, fintech companies have created new business models in the financial industry. This has a profound effect on the standard operating procedures, services, and products of the banking area, as well as on the incumbent institutions themselves. This rapidly growing business sector forces the whole banking industry to reconsider its previous business models. It also has implications for cost structure, efficiency, and future service delivery. Furthermore, they appeal to the younger, more technologically sophisticated population. This underlines the crucial importance of dealing with fintechs in regards to their position and competitiveness. This article aims to provide insight into the evolution of fintech in the banking sector. Furthermore, these company's success attributes should be emphasized, as well as the differences to an established bank. For this purpose, a literature review was applied, which included the descriptive and comparative approach. In addition, a case study of the N26 business model was conducted and analysed. Theory and practice should be demonstrated via the combined methods. According to the findings, there is a great deal of knowledge about fintech startups and their business strategies. In addition, it can be seen that these companies have the potential to continue to establish themselves in the banking sector. The banking industry is still in need of significant development, which is why fintechs should be taken into account.