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8
Jul

Swedish challenger bank Northmill Bank broadens its savings offering

Neobanks in the Nordics are on the rise and Swedish contender Northmill has not been resting on its laurels to meet the demand, having just introduced fixed-rate savings accounts.

The digital-first bank has bolstered its offering within savings by introducing its first fixed-rate savings account. The account has a 1.15% annual interest rate with a fixed period of 12 months.

The news comes after Northmill launched a savings account earlier this year with a variable interest rate of, at date, 0.95%, free withdrawals and state-provided deposit insurance.

“We have seen an increased demand for different types of savings accounts, especially with the current uncertainty in the markets,” said Hikmet Ego, CEO at Northmill Bank.

“Now we provide a safe and secure way for people to get predictability and grow their money. We also see that many customers seek a complement to their traditional banks’ offerings which we provide with our digital and mobile-friendly alternative that in addition offers competitive interest rates.”

The news comes as a number of challenger banks have launched in the Nordics in recent years. Danish Lunar extended its Series B round by adding €20m to its coffers in April 2020 after having originally raised €26m in the round in August 2019. Lunar is live in Denmark, Sweden and Norway. Rocker, formerly known as Bynk, raised $54.4m in Sweden in 2019.

While Icelandic neobank indó is currently focused on growing in its native market, its founder recently told FinTech Global that expanding into the rest of the Nordics could be in the cards within a few years.

Overall, the FinTech landscape in the Nordics has grown steadily in recent years. The FinTech industry in the region recorded strong growth in investment between 2016 and 2019 as investors backed innovative startups. Total funding grew at a compound annual growth rate of 45% from $214.3m in 2015 to $947.8m in 2019, according to FinTech Global’s research.

Moreover, the region seemed set for another record year before the coronavirus outbreak. The FinTech industry raised $321.6m in the first three months of 2020 alone, fuelled by large rounds raised by Klarna and Tink. How its outlook has been affected by the pandemic might still be a bit too early to tell.

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