N26.com Review – Pros & Cons of Banking with N26

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Experiences with N26: Free mobile Checking Account reviewed

The direct bank N26 promotes its current account with a high degree of modernity and mobility. So you can use the account without a card on your smartphone. But can our experience with direct banking confirm this impression? A test.

Their Specialization at a Glance:

• Money sending to 19 countries via Transferwise.
• Simple banking app facilitating the handling of money, helping with saving and budgeting with a special concept which they call spaces.
• Business Accounts for Freelancers and self-employed.

From the outset, the direct bank N26 specialized in the banking business via smartphone, so that today’s N26 current account is also closely linked to the associated mobile app. This integration enables exciting features but does not replace MasterCard or SEPA transfers, so we will test the free N26 checking account like any other direct bank’s checking account.

Getting an Account with N26

Getting an account is as simple as should be when it comes to modern internet banking. First of all, there are 3 basic requirements:

• Minimum age is 18
• You must be a citizen or permanent resident in the countries listed above in the overview table (Europe + USA).
• You need a compatible Android phone or iPhone

At registration you’re asked to provide the following data:

• Full name
• Email address
• Date of birth
• Social Security Number (SSN)
• Real home address (PO boxes/virtual mailboxes won’t work)
• Mobile phone number

In the next step you will have to verify your identity with an official ID document (passport or national ID card).

Proof of address in the case of N26 – interesting for digital Nomads:

The good thing about N26 is that you obviously don’t need to be a full time resident of the country where you signup for the account. As cleared in this reddit thread, it’s possible to provide just any address where you can receive the N26 debit card, this could even be a friend’s place. This is what the live chat report with N26 customer service shows in this screenshot. If you are a digital nomad without a permanent residency and therefore without proof of residency (without utility bill etc.) you can obviously still have the N26 account and get the card.

N26 Review: Current Account

Without a basic fee, the basic account management with N26 is successful, independent of regular cash receipts or a minimum account balance. Linked to this account is a overdraft facility, which currently costs an average of 8.9 percent interest per year (p.a.) with N26.

Thanks to the close connection to the smartphone mentioned above, you can receive push notifications for each account transaction or in the event of the drawdown of the overdraft facility. Unwanted transactions are detected so quickly.

The N26 App

While regular transfers can of course be made using the N26 app, the bank also integrates the Transferwise international transfer service into its own offering. This acts as an intermediary for international transfers and enables cheaper and faster transactions abroad compared to regular bank transfers. Transferwise integration into the N26 account is certainly practical. Holders of an account with any other bank can also use the service via their own website. Another special feature of the N26 account is that you can also use Google Pay or rely on Apple Pay.

All settings can be made mainly via the N26 app and the web interface in the browser. These include, among other things, card blocking, changing the card PIN or limit adjustments to the account. 3D Secure also works directly from within the app. This security procedure makes it possible for you to make online purchases by confirming them on your smartphone. You have five minutes to do this. You don’t have to enter a password.

You can only get account statements via the N26 website, not with the app.

No API

There is no API to external services, so transfers etc do not work with other banking app. This is a point some users find quite undemanding for an especially modern bank.

N26 Business Acccount

N26 does not distinguish between different business types. This means that although the virtual bank offers extra business accounts, it seems that these only refer to freelancers or individual entrepreneurs who issue invoices under their own name. Entries that do not contain the personal name of the account holder will be rejected unsolicited. If you have a “business account” with a different name and would like to receive four-digit amounts, you should refrain from using N26.

Larger Transfers at N26

According to customer reports, larger amounts can be problematic with N26. With a 6-digit bank transfer, the amount may not be credited to the account, and there might be no immediate feedback as to why the money hasn’t arrived. According to the report of a German customer, he sent €100,000 to his N26 account, which wasn’t credited there for days, while was debited from the other bank. N26 customer service wasn’t helpful in this case. The customer did not get his money back until a lawyer was called in, after more than a week.

Depositing Money on N26

In Germany and Austria there is also the Cash26 deposit and withdrawal service. This means that users can make cash deposits in certain supermarkets such as Rewe, Penny, REAL and more.

In contrast to many other direct banks, deposits up to €100 to the current account can be made free of charge, then they cost 1.5% of the transaction. The daily limit is €999. Withdrawals from the partners are generally free of charge, but are limited to €200 per withdrawal. In order to make a withdrawal in shops like a grocery store, you need to create a new Cash26 transaction in your N26 app, enter your transfer PIN and confirm the push message. Now the employee at the store cashier only has to scan the barcode and you can deposit or withdraw the money.

N26 Debit Card (MasterCard)

A fixed component of every N26 account is a debit card free of charge (MasterCard in Europe, Visa in the USA). In contrast to traditional credit cards, so-called charge cards, your account is debited with transactions in real time. Those who don’t mind this will find some advantages in the N26 MasterCard.

In contrast to Europe, where FinTech has a full banking license, the US subsidiary works with accounts from Axos Bank. As mentioned, instead of a Mastercard debit card, US customers get a Visa debit card. The scope of N26’s US banking app solution corresponds to the European functionality, categorizes spending, allows limits to be set, cards or sub-accounts to be blocked to better manage savings. In the course of 2019, a pay-back program and the N26 Metal premium card will also be launched in the USA.

The biggest advantage of the N26 debit card is that there is no foreign charge for cashless transactions worldwide. The situation regarding cash withdrawals is more complicated. Here you will find five free withdrawals per month in Germany if your N26 account qualifies as the main account. For this you must have recurring monthly account receipts or have deposited a total of €1,000 into the account. Additional transactions cost 2EUR. If your N26 account is not your main account, the number of free withdrawals will drop to three per month.

In the euro zone outside Germany, cash withdrawals are free of charge for an unlimited period. Access to cash in foreign currencies is less good: fees of 1.7 percent of turnover are always due here.

A regular bank card (Maestro) is not included as standard in the N26 account. If you need one, you can apply for a Maestro card free of charge if you can show €100 in your account. If accepted, this card can also be used for free cashless transactions worldwide. Cash withdrawals at ATMs are also not recommended with the Maestro card, as it costs two EUR in the euro zone and two EUR in foreign currencies plus 1.7% of turnover.

In Germany, however, it may happen that neither the Master nor the Maestro card is accepted, but only an EC card. There are still cash registers that accept cards (also contactless), but no Master/Maestro (because the merchants are probably still bound to bad contracts and pay high fees for credit cards?). You can’t have an EC card from N26.

Disposable Credit

Using the app, it is possible to set up a disposable credit, the amount can be selected within your own credit limit. This is granted within minutes in the app and can be adjusted and increased later. However, the creditworthiness (credit score / Schufa) will get checked.

Experiences with N26: Transparency

Although N26 always presents itself in a very chic design, most of the relevant information about fees for accounts and cards can only be obtained by taking a look at the hidden list of prices and services. The fact that the MasterCard is a debit card only becomes clear here. There is room for improvement in this respect.

Fees

The 3 different packages only seem to be available in Europe so far, we haven’t seen them on the website for US customers. Maybe they are on progress.

Regular: €0 / month
N26 You: €9.90 / month
N26 Metal: €16.90 / month
No added exchange fees
1.7% ATM (0 for Metal members)

N26 You and N26 Metal

With the packages N26 You and N26 Metal you get additional packages for your N26 account. Here you can customize your account to your own needs. The You package costs €9.90 per month and includes a genuine MasterCard credit card, which also eliminates the cost of cash withdrawals in foreign currencies. N26 Metal costs €16.90 a month and also includes a metal MasterCard credit card that can be personalized in a variety of ways. Here, too, there is no machine charge abroad. Both additional packages include extensive insurance benefits and exclusive partner offers. Metal customers also receive preferential customer service.

Customer Support

There is predominantly positive feedback when it comes to the N26 customer support via phone or live chat. The service staff are nice and helpful and it’s easy and fast to reach them. Only during peak hours it might take a little longer. However, some users reported that support may only respond after several weeks with standard phrases. This for sure depends on the topic of the request. But we agree that this should never be the case.

Conclusion:

Strong offer – The worldwide payment with the N26 MasterCard without any additional fees distinguishes the N26 checking account. We are also impressed by the free account management and the free cash withdrawals, albeit limited in number. In individual cases, the lack of a Girocard could lead to problems. Competitors Santander and DKB have no restrictions on cash withdrawals and also offer genuine credit cards with no foreign charges.