Gilles Roth: « Admission as an e-money institute is only granted on a written application »

Neobanken, also known as digital banks or fintech banks, are financial institutions that offer their services exclusively online and via mobile apps and do without a branch network. You therefore have no physical branches and rely on modern technologies to create efficient and user-friendly banking experiences. More and more providers are pushing onto the market – and changing the way banking is processed – in Luxembourg.

According to French media reports, for example, Neobank Revolut, which has developed an online banking app with more than 50 million customers worldwide, has decided to open its second headquarters in the European Union in France and to apply for a banking license there.

Wanted the Neobank to Luxembourg?

The investment of Revolut in France would amount to more than one billion euros over three years. MP Laurent Mosar (CSV) thus introduces a parliamentary request to Finance Minister Gilles Roth (CSV).

« According to my information, the bank has not received a permit from the Luxembourg authorities, » Mosar continued. He questioned whether the minister does not believe that « the application of Revolut should have been approved for admission? »

He also asks Roth about an assessment of the potential of such “Neobanken” for the Luxembourg financial center.

Services exclusively online and via mobile apps

As far as revolut approval is concerned, the finance minister refers to a previous answer to this topic. It was not the government’s task to comment on individual cases that are edited by the CSSF and, if necessary, fall under the CSSF’s professional secret.

He also refers to the law of November 10, 2009 on payment services, according to which « the approval as an E-money institute is granted by the minister on a written application, which is responsible for the CSSF ». The company, which is for debate here, did not make a corresponding written application to the finance minister, Roth specified.

13 e-money institutes in Luxembourg

Although such services are becoming increasingly popular, according to Roth, several studies show that the actors concerned still have difficulty being profitable. They would often be supported by banking groups.

« With agile, inclusive and user-oriented solutions as well as technological progress and the use of new digital technologies, these actors complement the traditional banking system. They contribute to strengthening the attractiveness of Luxembourg as a European FinTech hub, » said Roth.

In Luxembourg there are currently 17 payment transactions (« Établissements de Paiement ») and 13 e-money institutes, not calculated by traditional credit institutions that have already offered their customers online banking or even mobile banking services.