The FinTech Northmill, which offers cloud-based financial services, was awarded a banking license from the Swedish Financial Supervisory Authority (SFSA) on Friday (Sept. 13), according to reports.
The company submitted an application two years ago and is now all set to become an official bank.
“Northmill has grown organically and laid a solid foundation with our current credit and insurance offerings to our 200,000 users,” said Margareta Lindahl, chairwoman of the board at Northmill. “The most recent product, Rebilla Reduce, aims to lower people’s current interest rate on existing credits. By being able to operate as a bank, we have the tools to take the next step and drive true positive change for the users.”
Northmill said it had a “constructive dialogue” with the SFSA, and that banking services like payment transfers, saving accounts and cards will all be added “in the near future.”
“The banking license means a great responsibility, and it is gratifying to see that Sweden and its authorities foster innovation,” Lindahl said, adding that the mission of the bank is to “simplify people’s financial lives through technology and innovation.”
As part of the deal, Northmill must maintain a capital minimum of €5 million.
There is a number of cloud-operated FinTechs offering the same services as Northmill. It will be competing with N26 in Germany, Revolut in the U.K. and Monzo in London. N26, which started in 2013, has a valuation of €2.38 billion and offers banking services that it says are all-inclusive with zero hidden fees.
Revolut boasts different types of services, like a mobile-based account that allows customers to transfer, exchange or hold money without any fees, as well as the transfer of cryptocurrencies. Monzo recently secured €126 in funding on a €2.2 billion valuation.