An honest review of N26

An honest review of N26

An honest review of the N26 online bank after a year of use. Are the neat features worth dealing with a FinTech startup? Here is the verdict.

When I just landed in Berlin, I opened a bank account with Commerzbank, because there was a branch downstairs.

Commerzbank is an old-fashioned bank. You are assigned an advisor - a real human being - and you must go through that person for most major operations. Lost your credit card? Email your advisor. Need to open a brokerage account? Book an appointment with your advisor. Need to close your account? Advisor. They once confirmed an appointment by mailing me a letter. Commerzbank is a great bank... for another century.

The biggest problem, however, is that Commerzbank charges a nauseating number of fees for day-to-day operations: 7 euros a month for an account, 6 euros for using another bank's ATM, 40 euros a year for a basic credit card and so on. As a card-carrying penny pincher, that quickly got old, and I began looking for a new bank.

The new kid on the block

When I asked around, every colleague and friend of mine was raving about N26 (then Number26), the hip new online bank with the flashy app and neat transparent card. At face value, Number26 was a solid choice: no fees, free cash withdrawals from any ATM, free credit card and a neat app. That seemed like a good deal, so I gave it a try.

n26-card.jpg#asset:286:contentFullwidth

A "straightforward" signup process

Opening an account with N26 is fairly straightforward. You install the app, start a video chat, show your ID and you are done. If all goes according to plan, you're done in 8 minutes. You don't even need an Anmeldung!

Things did not go according to plan.

N26's video identification partner, IDnow, does not support all ID documents. When I signed up, they would not allow Canadian passports. They support passports from more countries now, but not from all of them.

If you use video identification, you must use Postident. You must print a piece of paper and bring it to the post office. The person at the post office will verify your identity, and you will get your N26 card a few days later.

Postident does not support all passports either1,2,3. Russian, Ukrainian, Indian and Pakistani citizens who can't get Deutsche Post to accept their passport. Postident also requires a Meldebescheinigung. If you don't have a registered address in Germany, you don't have this document, and you can't open an N26 account. If you just arrived in Germany and you need a bank account right now, this is a problem. Other banks have this problem, but this needs to be mentioned.

Nonetheless, once your account is all set up, everything should go smoothly, right?

Well... mostly.

In order to use N26, you must pair a phone with your account. Your phone is used to confirm transfers and other account operations. If you don't have a phone, you cannot use N26 account. If you don't have Android or iOS, you cannot use N26. If you don't have a phone number, you cannot pair a new phone, and you cannot use N26. No phone, no bank transfers.

When I changed jobs last summer, I had to return my company phone, so had no phone number for a few weeks. During that time, I was effectively locked out of my N26 account, and could not transfer money from it. Without my old Commerzbank account, I could not have paid the rent that month.

Moreover, I could not unpair the old phone, as I gave it back on my last day of work. It had to be unpaired manually by N26's customer service before I could pair a new device. It took a short phone call to solve the problem.

Some other significant issues have plagued N26 customers since the company's debut in 2016: accounts closed without warning, security issues, condition changes, new fees and so on. N26 does not have the best of track records. Things have improved a lot since then, but it's still worth knowing.

Free as in beer

Why am I still an N26 customer despite those setbacks? Because it saves me over a hundred euros a year.

Commerzbank charged me 7 euros a month to keep an account open, 40 euros a year for a basic credit card, and 5 euros for withdrawing cash from other ATMs. N26 never charged me a dime. Never at all. Using N26 has been 100% free since I opened my account.

The N26 app

n26-transaction-list.jpg#asset:74:contentFullwidth

In addition to the unbeatable price, N26 offers a fantastic user experience. I am willing to deal with occasional issues if their service makes my life easier, and it does.

At the centre of this great user experience is the N26 app.

Everything can be done from your phone through this app. In fact, some features are only available through the app.

The N26 app seamlessly integrates with iOS. You use TouchID to login, force touch to see your account balance from the home screen, and widgets to keep an eye on your finances. Transaction notifications appear as regular iOS notifications. These little details matter.

Transaction notifications are by far my favourite feature. You get a notification on your phone when money goes in or out of your account. When I pay with my N26 card, my phone vibrates in my pocket before I even get the receipt from the cashier. It helps me notice unexpected transactions, and makes budgeting a breeze.

The expense tracking features are also quite nice. The app splits your expenses into categories and gives you an overview of your spending habits. I don't use it much myself, but it can be useful.

Another neat feature is the Cash Map, which shows you ATMs in the vicinity. On iOS, you can reach it from the home screen with force touch. It's easier than to type "atm" in Google Maps, and shows more or less the same results.

The app also lets you instantly transfer money to other N26 users using their email address or phone number, a faster alternative to IBAN transfers. I use this with a few of my friends.

You can also set recurring payments. This allows me to pay my rent on time every month without even thinking about it. I get an email and a notification that confirm the payment went through.

There are other services available through the app (insurance, investments, etc.), but I have not tried them.

The N26 website

The N26 website gives you another way to access your transactions and make transfers. It's very similar to the apps, but is missing some of the special features. However, it still lets you view your transactions and make transfers.

If you want to transfer using the website, you must confirm the transaction on your phone. It's a minor hassle, but it's much better than the stupid photoTAN system.

Technical support in English

N26 and Deutsche Bank are the only German banks to officially offer English technical support. My colleagues still receive some German paperwork from Deutsche Bank, but N26 correspondence is 100% in English. If you don't speak German, N26 is the best option. 

Since N26 is an online bank, you can't meet face to face with an advisor. If you have questions about your finances, investments or loans, you might want to open an account with a traditional bank like Deutsche Bank or Sparkasse. N26 is an online bank, so there are no branches you can go to. On the bright side, you will never have to go to a branch across the city to sign a document.

In general, I found the N26 customer service perfectly acceptable and responsive. The live chat convenient if you are at work or just don't like making phone calls.

Verdict: it's worth it, but...

N26 is still in its early years, and it's hard to escape the perception that you are dealing with a startup. Their signup process has issues, their app has issues, and they don't account for situations like "having an Indian passport" or "not having a phone". The truth is that despite those setbacks, N26 is great for most people, most of the time.

It's hard to ignore the fees you would pay for the same perks at any other bank, and that N26 is the only German bank that officially offers English support. It's also one of the few banks that lets you create an account before you have done your Anmeldung.

Would I recommend N26? Absolutely. All of my day-to-day transactions go through N26, and I am overall quite satisfied with the experience, despite some hiccups in the first few months. I closed my Commerzbank account and made N26 my only bank in February 2018. Go ahead, open an account. Tell them Nick sent you.

Visit the N26 website

If you deemed that N26 is not for you, take a look at DKB or ING DiBa, both of which are highly recommended by my colleagues and friends, or perhaps consider an established brick-and-mortar bank. Comdirect is another free online bank. We wrote a solid overview of other German banks here.

This article uses affiliate links. When you click these links and open an N26 account, we make a little money. We use that money to pay our hosting bill, expand the website and donate to charity. We don't sell recommendations or write reviews for money.

Updates

2017-09-25: Added corrections from commenters

2017-10-05: Added that Postident only supports a limited list of ID documents

2017-12-13: Corrected some facts, adjusted some parts to match my current opinion.

2018-08-01: Corrected section about supported countries. Added details about Anmeldung.

Comments

  • Oct 16th, 2018 Obinna wrote:

    This comment is awaiting moderation.

  • Oct 15th, 2018 Leo wrote:

    Hey there Nick, quick question, if you don't mind: I am asserting the possibility of shedding my Sparkasse account, due to their (unreasonable) fees, but, as you might suspect, am a bit skeptic about receiving my salary straight into N26. Care to share your opinion of this matter, since to my understanding, you are so doing at the current stage?

  • Oct 13th, 2018 Filipe wrote:

    I've read N26's Privacy Policy, and is far worse than most conventional banks. Commerzbank's isn't great either, but N26, Revolut, and a few others need to up their game.

  • Sep 25th, 2018 Gali wrote:

    I have an account with n26. A transfer I made over two months ago was failed, yet this money is still missing on my account. Meaning, the money went through but didn't arrive its' destination, but n26 are saying it's gone. Anyone has any idea how can I get them to refund me and send MY money back to my account?
    Conclusion- the moment you have a real problem, there is no phone line and the correspondence goes only by chat or emails and takes forever.
    Hope someone could help.....

  • Sep 21st, 2018 Jim Croke wrote:

    I spoke with their "customer care" team on Wednesday morning who advised me it would take 7hrs to transfer from Australia to my acc via 3rd party "transfer wise" it's now Friday 4pm and the response I'm getting is "we can't see incoming transfers" and sorry theres nothing we can do. Not a great start to n26 being left in limbo for 3 more days . 1* regardless of free stuff.

  • Sep 21st, 2018 Hyun wrote:

    I tried N26 and ING-Diba at the same time and found ING-Diba is much better because of customer service. You can actually speak with a person with ING-DiBa. However, N26 only services you through their chat system who I suspect is not N26 staff but hired remote company customer support company. I have been trying to close my N26 account but they are keeping my money for already now over a month. They keep telling me N26 will contact me with closing status but as of now no progress. So beware.

  • Sep 18th, 2018 Nicolas Bouliane wrote:

    You are right Matt. If your document is not supported by the Video ID process, you need to use PostIdent, which requires a Meldebestätigung (and an Anmeldung).

    This was the case when I opened my account, and it's still the case for some passports.

  • Sep 18th, 2018 Matt wrote:

    Just a disclaimer here: the thing with the Anmeldung is not all true. If you're required to confirm identity through Postident, the post office employee needs your address and he might ask for a document to confirm. I guess it's not a completely strict requirement but it happens frequently (did to me just recently).

  • Sep 9th, 2018 Jan wrote:

    Are the cash withdrawals 100% free? I read on their website that you have 5 withdrawals / month free then it’s 2€ / withdrawal ..

  • Leave a comment