Neobank

Neobanks are purely digital banks without a branch network that offer all banking services via a smartphone app – often free or very cheap.

The largest in Germany:

N26:

• Approx. 4.8 million customers in Germany
• German banking licence, full deposit protection (€100,000)
• Free basic account, premium from €4.90/month
• Watch out: BaFin has intervened several times over money laundering shortcomings

Revolut:

• Approx. 3 million customers in Germany
• EU banking licence (Lithuania)
• Strength: cheap foreign currency exchange for travellers

Trade Republic:

• 5 million users, started as a neobroker, now also a current account
• Full EU banking licence
• 3%+ interest on the clearing account

Advantages vs. traditional banks:

✅ Often a free account
✅ Real-time notifications for every transaction
✅ Modern app with budgeting features
✅ Cheap abroad

Disadvantages:

❌ No personal adviser
❌ Depositing cash difficult/impossible
❌ Some landlords/employers don't accept neobank IBANs

Fact: over 70% of under-30s in Germany open their first account with a neobank rather than a Sparkasse.