N26 Says Goodbye to Brazil: Focusing on European Market Growth
N26, the German digital bank, has recently made the decision to exit the Brazilian market as part of its strategic shift towards focusing primarily on its operations within continental Europe.
Initially aiming to establish a global presence, N26 disclosed plans to enter Brazil back in 2019. Although it commenced testing with a select group of waitlisted users in late 2021, the bank never officially launched its services to the wider public in the country.
As part of its redefined strategy, N26 has announced the gradual cessation of its operations in Brazil over the coming two months, emphasizing a redirection of attention towards its fundamental European markets.
Notably, the bank is offering around 70 of its Brazil-based employees the opportunity to apply for available positions within its European offices.
The decision to exit Brazil follows N26’s prior departures from the US two years ago, despite having accumulated a substantial customer base of 500,000, and from the UK in 2019 due to constraints related to Brexit.
While N26 had secured $900 million in funding two years ago at a valuation of $9 billion, the bank has encountered a surge in compliance costs amidst increased regulatory scrutiny, consequently resulting in escalating losses.
In response to the challenging macro-economic environment, N26 previously announced a reduction in its workforce by four percent in May, as part of its measures to adapt to the current business climate.