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Comment by mytailorisrich | Hacker News Reader

They are using Brexit as a scapegoat.

The referendum was almost 4 years ago and only last year they were talking about expanding in the UK. Some people might have been in denial but considering the political force of a referendum result and the glaring absence of any political alternative for years now, any other Brexit outcome was a fantasy and remaining in the single market never realistic.

As you say the reality is that they are not doing very well in the UK and they are also investing in the US, and so made a commercial decision not to invest further in the UK.

Edit: As far as I know a full banking licence is not compulsory to offer purely electronic current accounts in the UK. Revolut only got a banking licence in 2018, and it is from Lithuania, so they are also at risk of losing it for their operation in the UK. Just saying...

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I think you should follow UK politics more closely.

Referendum was 4 years ago. But only until the recent election i.e. Dec 2019 did Johnson have the numbers in Parliament to actually "get Brexit done". And this week for the first time in 4 years, UK government is formerly advising businesses that there will be a hard Brexit:

https://www.gov.uk/government/news/government-confirms-plans...

I am in the UK, I know all about Brexit and British politics ad nauseam.

The point remains that this isn't the key reason behind their decision. I guess it's easier to blame Brexit than to explain to your customers that you're closing their accounts because of good old business.

They launched in the UK after the Brexit referendum and they don't even need that bank licence to offer electronic current accounts in the UK (Revolut did that for 3 years and their current bank licence is also an EU one so may also become useless in the UK).

Brexit affects business; they're not cleanly separable. Companies that were competitive before may not be anymore. The only real test would be to take projected metrics (in terms of business closures, job losses etc) from before the vote and compare to reality.

N26 is not competitive in the UK, Brexit or no Brexit, judging by the numbers. There are more established competitors and N26 is struggling to take off.

That may all be true (and it does seem to be), but it doesn't necessarily mean Brexit is a scapegoat.

With an EU-wide banking license, N26 can operate in any territory it chooses to, for relatively little marginal overhead. Once they need a completely separate banking license for the UK, it changes the model significantly and would need them to be significantly more successful to justify continuing operations here.

I get the feeling that every time Brexit is cited as a factor causing a business to leave the UK, those who support Brexit will be able to point their fingers at all the other contributing factors and label Brexit a scapegoat. Sure, Brexit will usually be a contributing factor rather than the only obvious cause. Businesses that are doing well will manage to survive the Brexit hit. That doesn't make Brexit good or even neutral for business.

Please refrain from the tired personal attack that consists of 'accusing' people of supporting Brexit simply because they refuse to blindly buy that anything going badly is "because of Brexit".

It may also be that the EU banking system has customer tracking, the UK does not. N26 relies on customer tracking, so you can’t just withdrawal a large amount of money and disappear.

It is all brexit related, why can’t you see that? Why else would they suddenly pack up shop?

Unfortunately This is just the first to come.

It's not even the first, in terms of businesses packing up shop. Norton motorcycles is another recent example that springs to mind.

Norton went bankrupt. N26 are choosing not to operate in the UK any longer.

> It may also be that the EU banking system has customer tracking, the UK does not.

Can you explain a bit more what you mean by this? Tracking exactly in which sense?

As part of the EU money laundering scheme. A bank within the EU can access data on a client who's with another bank without another EU country.

So lets say you have a bank account in the United Kingdom. Now for whatever reason, I am now living in Austria, the bank can ring up my information without additional paperwork.

Now that the UK is in the process of transition, this isn't possible unless a court order is presented yadda yadda. It would be a threat for like N26 to have me as a client but unable to look in to my spending habits. If I had a bank account with loans enabled, I could take a loan and just disappear.

> Now that the UK is in the process of transition, this isn't possible unless a court order is presented

Under the European Union (Withdrawal Agreement) Act 2020 all existing EU law has been incorporated into our domestic legislation so the EU mony laundering scheme (assuming it is some form of legislation by the EU) still applies even though we are no longer an EU Member State.

However, it can be repealed after the transition period ends (1st January 2021) which might well happen depending on the priorities of the Government at that time.

Brexit means it is more costly for them to operate in the uk, and they’ve decided the UK market is not worth that extra cost. If that’s not about Brexit I don’t know what is.

This will be true of many regulated industries if regulations diverge, and most industries with a supply chain across Europe too, so expect to see a lot of factory closures in the coming years, along with missed opportunities for new investment (for example Brexit was a significant factor in Tesla avoiding the UK, and financial services like EU clearing will probably gradually move toward the centre of gravity too).

You are in denial about the financial impact Brexit will have.

https://www.theguardian.com/technology/2019/nov/13/tesla-cit...

https://www.reuters.com/article/us-britain-eu-clearing-exclu...

https://www.theguardian.com/business/2019/feb/03/nissan-conf...

Brexit will have a financial impact, but I don't believe it will be what everyone thinks it will be. The UK will likely have forgotten the 'light touch regulation' that in part caused the credit crunch, in the chase for bringing business to London in the mid 2000s.

History will probably repeat itself: the current, or next Government will reduce regulation to encourage businesses to stay or locate in London. Banks will exploit it somehow. Cue next financial crisis.

I dunno what your industry experience is but I imagine it non existent.

Any business in this sector had prepared over a year ago for a worst case scenario. New business entities etc have been long up and running

Any business so inclined can also use this https://www.bankofengland.co.uk/eu-withdrawal/temporary-perm...

If you believe this nonsense you have a problem

I think there's an element of truth to the scapegoat argument.

By all reports, N26 was not doing so well in the UK. Other established challenger banks such as Monzo and Starling are taking up the mindshare of people wanting to move from an incumbent bank, leaving little room for N26.

It may be possible that with just 200-250k current accounts in the UK, it wasn't deemed worthwhile to go through the effort of gaining a UK banking license to keep their UK expansion efforts going. The competition is just too hot.

> The referendum was almost 4 years ago and only last year they were talking about expanding.

Last year it looked like Brexit might quietly just never happen.

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