Dutch digital bank Bunq plans to re-enter the UK to tap into a “large and underserved” market of around 2.8 million British “digital nomads”.
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Dutch challenger bank Bunq told CNBC it plans to increase its global headcount by 70% this year to more than 700 employees, even as other financial technology startups have decided to cut jobs.
Bunq, which operates in markets across the European Union, is looking to expand into new territories including the United Kingdom and the United States, taking on existing fintechs in the country, including the likes of Britain’s Monzo and Revolut, and America’s neobank Chime.
Bunq says it needs the right talent in the region to support its global expansion ambitions. To that end, the company said it will see this year with 735 employees worldwide – up 72% from 427 staff members at the start of 2024.
“Bunq is focused on digital nomads who tend to wander the world,” Ali Niknam, Bunq’s CEO and co-founder, told CNBC via email comments.
The so-called “digital nomad” is defined as someone who travels freely when working remotely, using technology and the internet to work abroad from a hotel, cafe, library, co-working space, or temporary home.
“We love being able to serve users everywhere – because of the regulatory environment we’re in, it means we have to have a lot of extra people to do this,” added Niknam.
Bunq is currently applying for banking licenses in the US and UK. Last year, the company submitted an application for a federal banking license. And in the UK, Bunq is awaiting a decision from the financial regulator on its application to become a licensed e-money institution, or EMI.
The digital bank said it is actively hiring in sales and business development, product marketing, PR, affiliate marketing, and market analysis, as well as user support, development, and quality assurance.
Many of those positions will be part of a “tailored digital nomad” program that allows staff to work from anywhere in the world, Bunq said.
However, the company confirmed that it is not closing its office space and that many new employees will work in its offices, including in Amsterdam, Sofia, Istanbul, Munich, Paris, Dublin, Madrid, London, and New York City.
In contrast to the job cuts in other fintech
Over the past two years, one of the biggest stories in the fintech industry and the broader tech industry has been companies slashing their workforces to reduce the huge costs incurred during the pandemic in 2020 and 2021.
The operating environment for fintech companies is getting tougher, with inflation affecting consumer confidence and higher interest rates, making it difficult for startups to raise money.
In January last year, the cryptocurrency exchange Coinbase cut 950 jobs. It is followed by the payment giant PayPalwhich reduces the number of global employees by 2,000 people in early 2023, and then another 2,500 jobs in early 2024.
Meanwhile, some fintechs are looking to artificial intelligence to take on a growing role.
Swedish buy now, pay later company Klarna, for example, said last month that could reduce the workforce from 5,000 to 3,800 over the past year from attrition alone. He added that he wants to reduce the number of employees by 2,000 through the use of AI in marketing and customer service.
“Proven efficiencies of scale have been enhanced by investments in AI, which have reduced operating costs and increased gross margins,” the company said in its first-half earnings call.
Klarna says that average revenue per employee has increased by 73% year over year, due in no small part to the internal application of AI.
Niknam Bunq says he doesn’t see AI as a way to help companies reduce headcount, however.
“We’ve been using AI systems and solutions for years before it became mainstream, (but) in our experience, AI empowers employees to do better by users, more effectively and efficiently,” he told CNBC.
Bunq earlier this year reported its first profitable year, generating 53.1 million euros ($58.51 million) in net profit in 2023. The business was finally valued privately by investors at 1.65 billion euros.