N26, Monzo, and Revolut are leading digital banks based in Europe. In 2019, they all entered the US market. How are these companies adapting to compete? What can they offer users that traditional banks can’t? This article includes details that you need to know about each of these options and the blueprint for how they can increase their odds of gaining widespread user adoption in the United States.

Note: All fees, features, etc. found below are relevant for the US market as of August 12, 2019.

Headquarters: Berlin, Germany

US Launch Date: July 2019

Signup/Approval Wait Time: You can signup directly from your phone in 5 minutes.

Fees: No hidden fees, no minimum account balance, no maintenance charges, and no foreign transaction fees when you spend using your N26 card overseas

Important Features: With N26, you can receive your paycheck two days faster than with traditional banks. The app can automatically categorize transactions so that you are able to get a clearer understanding of your budget and spending habits.

FDIC Insurance Policy: $250,000 through Axos Bank

Current Status: Live

N26

Headquarters: London, United Kingdom

US Launch Date: June 2019

Signup/Approval Wait Time: Unknown

Fees: Monzo won’t charge you to withdraw cash in the US, but you may be charged by the ATM operator. When you’re outside the US, the first $200 every 30 days are free, with a 3% charge after that.

Important Features: Monzo allows you to easily split bills with your friends if they are also on Monzo. You can pay nearby friends over Bluetooth without needing to know their details.

FDIC Insurance Policy: $250,000 through Sutton Bank

Current Status: Waitlist Signup Required

Monzo

Headquarters: London, United Kingdom

US Launch Date: To Be Determined

Signup/Approval Wait Time: Unknown

Fees: You can transfer money to anyone outside the U.S. in 29 currencies with the interbank exchange rate. For transfers abroad, there is a 0.5% fee for anything above $6,500 each month. A flat mark-up on weekends and on certain currencies may apply. Revolut allows you $300 in ATM withdrawals per month without a fee. Anything over $300 per month comes with a 2% fee.

Important Features: Whether you’re paying rent or splitting the bill, you can set up a recurring payment in under a minute. Revolut offers added security features like location-based security to block transactions in unknown locations and the ability to freeze or unfreeze the Revolut card in-app.

FDIC Insurance Policy: $250,000 through Metropolitan Commercial Bank

Current Status: Waitlist Signup Required

Revolut

Are Americans Using Digital Banks?

Millennials supposedly are the most likely to use digital banks. The reality is that adoption isn’t on par with these expectations. According to a study from Cornerstone Advisors, just 3% of millennials have a primary checking account at a digital bank. While it might seem that this is because digital banks are not established, US-based digital banks have actually been around for a while. Examples include Simple (founded in 2009), Moven (founded in 2011), and Chime (founded in 2013).

Even though digital banks have been offering more accessibility and fewer fees for over a decade, they haven’t gained significant adoption to date for a few reasons. First, few digital banks offer both checkings and savings accounts for customers. For US customers who want to easily save and spend, checking accounts from digital banks typically don’t offer an effective solution. Second, most options don’t offer rewards/points that are comparable with credit cards. Thus, for people who can pay off credit bills on time, there is more of an incentive to keep using that form of payment.

For older generations, having a local bank branch can be an important factor in choosing a bank. While many people are increasingly used to using online banking as a means of sending and receiving money, physical locations can still give a sense of comfort to some customers. This is a preference based upon what people are accustomed to but appears poised to change in the coming years with younger generations.

The Blueprint: 5 Ways European Digital Banks Can Compete in the US