Denizen launches first account with fee-free cross-border payments
Banking start-up backed by Spanish bank BBVA to target expats in US
Denizen charges no foreign exchange fees, provides a regular debit card rather than a prepaid one and allows clients to maintain a single balance across jurisdictions
A Silicon Valley start-up backed by Spain’s BBVA is launching the world’s first global bank account that will allow account holders to receive money in one country and pay it out in another without incurring any payment fees.
Denizen, created at BBVA’s in-house incubator and funded by the bank’s digital business unit, will target Spanish expats living in the US but will add up to 10 other EU countries by August.
“National borders act as barriers to the free movement of money, inhibiting individuals and limiting the potential for global commerce,” said Joaquín Ayuso de Pául, Denizen co-founder and chief executive.
Denizen aims to “simplify banking for global citizens”, he said.
The payments service TransferWise already offer borderless accounts, but with charges.
Denizen charges no foreign exchange fees, provides a regular debit card rather than a prepaid one and allows clients to maintain a single balance across jurisdictions. A fee schedule for holding the account is currently advertised but the bank is understood to be reviewing the charge, according to a personal familiar with the plans.
The start-up is licensed as a payments company, not a bank. It will offer its borderless bank accounts through partnerships with BBVA and other banks in countries where BBVA is not licensed.
Denizen’s creation was aided by the EU’s PSD2 directive on payments, which forces banks to open up their payment infrastructure to outsiders in a bid to create more competition in banking.
Denizen would not give details of its customer acquisition target, but Ian Ormerod, BBVA’s global head of new business, said it was suitable for “more than 50 million expats and 250 million migrants”.
Britain’s departure from the EU is set to increase the number of Europeans living and working across national borders, as many professionals plan to leave their families in London and commute to their new company bases in the EU.
Denizen employs about a dozen people and has hundreds of BBVA staff also working on its offering. At launch it will offer only current accounts but plans to expand into credit and other products.
Spain’s second-largest bank, BBVA has been one of the industry’s most proactive investors and developers in fintech after Francisco González, its septuagenarian executive chairman, began a mission to transform the 161-year-old bank into a digital business.
BBVA’s new digital business unit owns 40 per cent of the UK’s mobile-only Atom Bank, as well as US direct banking firm Simple, Finland’s online bank Holvi and Mexico payments company Openpay. It has spun out other companies from its incubator and also invests in fintech through its venture capital arm, Propel Venture Partners.
This story was amended after publication to reflect that a fee schedule for holding the account is currently advertised.