Deutsche Bank takes 5 per cent stake in Deposit Solutions

Hamburg's open-banking specialist becomes unicorn worth USD 1 billion; reports
20 September 2019

Deutsche Bank is a new partner in Deposit Solutions GmbHthe two companies announced on Thursday, September 19, 2019. The Frankfurt-based financial house is taking a stake of 4.9 per cent in the Hamburg fintech company. The total investment was not revealed. The technology allows banks and other participants to integrate an open banking platform for savings deposits into their service. Deutsche Bank has since 2017 been operating its own “Zinsmarkt” service based on the technology provided by Deposit Solutions. This is the first time that the fintech company is allowing one of its clients to take a stake, Tim Sievers, CEO and founder of Deposit Solutions, said. As Handelsblatt among other media reports, Deutsche Bank is turning Deposit Solutions into a unicorn, with its value exceeding the billion-dollar mark. The two companies have not commented so far.

From client to investor

Sievers sees Deutsche Bank’s investment as a milestone in two respects: “Firstly, expansion into other Deutsche Bank business areas domestically and abroad will accelerate our growth. And secondly, we are opening ourselves for the first time to having our clients participate as stakeholder in the infrastructure they use.” For its part, the move provides evidence of Deutsche Bank’s intention to operate as a digital platform as well, Karl von Rohr, deputy chief executive at Deutsche Bank, said.

Expanding internationally

Around two billion euros in deposits are currently being invested via Zinsmarkt, according to Deposit Solutions. Apart from Deutsche Bank, there are* almost 100 other banks in 18 countries* using its platform, either to offer their customers investment products provided by outside banks, or to collect customer deposits via the platform. The Hamburg-based company is looking to expand on the basis of this business model: Deposit Solutions was launched in Switzerland at the start of 2019, initially outside the European Union. A launch in the United States is planned over the months ahead.

Hamburg’s Fintech Ecosystem

Alongside Deposit Solutions, the credit-scoring company Kreditech, the loan-comparison portal and the crowd-investing platform Exporo – which was able to secure a capital injection of 43 million euros in the summer of 2019 – are among the large, internationally significant players in Hamburg’s fintech landscape. In addition, HafenCity is home to the first Fintech Hub in the city. Fintech Week, one of the leading events in Germany on the digitalization of the financial sector will take place at the start of November 2019.