The incorporation of fintechs into the banking sector: The fintech N26 as a case study

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, these fintech startups appeal to the younger, more technologically sophisticated population. This underlines the crucial importance of dealing with fintechs in regard to their position and competitiveness. This article aims to provide insight into the evolution of fintechs in the banking sector. Furthermore, these companies’ success attributes should be emphasised, as well as the differences to an established bank. For this purpose, a descriptive and comparative literature review was conducted. In addition, a case study of the N26 business model was performed and analysed. According to the findings, there is a substantial knowledge about fintech startups and their business strategies . In addition, 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 considered.