Dutch digital bank Bunq is making moves to re-enter the U.K. market, targeting a group of 2.8 million British “digital nomads” who are currently underserved. Bunq CEO Ali Niknam announced that the bank has filed for broker-dealer registration in the U.S. as part of its expansion plans across the Atlantic.
This broker-dealer application is a crucial step for Bunq in its journey towards obtaining a full banking license in the U.S. While Niknam couldn’t provide a specific timeline for when this authorization will be secured, he expressed excitement about the growth opportunities that lie ahead for Bunq in the American market. Once the broker-dealer license is obtained, Bunq will be able to offer most of its services in the U.S., with the exception of a savings account.
Bunq, known for catering to “digital nomads,” currently holds a banking license in the European Union and has applied for an Electronic Money Institution (EMI) license in the U.K. The bank had previously operated in the U.K. but had to withdraw in 2020 due to Brexit.
In a previous attempt to enter the U.S. market, Bunq filed for a Federal bank charter in April 2023 but later withdrew the application due to issues between its Dutch regulator and U.S. agencies. The company plans to resubmit its application for a full U.S. banking license later this year.
In addition to its international expansion plans, Bunq reported a significant 65% year-over-year increase in profit, reaching 85.3 million euros ($97.2 million). This growth was primarily driven by a 55% rise in net interest income and a 35% increase in net fee income. Like its fintech counterparts N26 and Monzo, Bunq has benefited from a high interest rate environment by earning yields on customer deposits held at the central bank.
Despite the recent trend of central banks in the EU, U.K., and U.S. cutting interest rates in response to economic concerns, Niknam remains optimistic. He believes that any potential decline in interest income can be offset by a diversified revenue mix that includes income from paid subscription products and new features, such as the recently launched stock trading tool for users.
As Bunq prepares to navigate the competitive landscape of the U.S. market, facing established banking giants like JPMorgan Chase, Bank of America, and Wells Fargo, as well as prominent fintech companies like Chime and Robinhood, the bank remains focused on providing innovative services to its target audience of digital nomads. With its strategic expansion plans and profitable growth trajectory, Bunq is well-positioned for success in the evolving financial landscape.
