Coop Returns to Banking with Digital-Only Neobank Offering

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Five years after divesting from the banking business, retail giant Coop is making a return. However, this is not a comeback for the former Bank Coop, which was sold off to Basler Kantonalbank in 2017 and subsequently rebranded as Bank Cler. Instead, Coop is transitioning into a Neobank, a financial institution offering banking services online and digitally.

The new banking model will be operated through the Coop Finance+ app, already available on the App Store and Google Play. The Hypothekarbank Lenzburg will handle the execution of banking transactions, a clever move that allows Coop to avoid the need for a banking license and save on costs.

Coop Finance+ offers a range of services in collaboration with Hypothekarbank Lenzburg, including a savings and private account. Account management and debit cards are free in the first year. Account holders can also withdraw cash without fees at the tills of approximately 1000 Coop supermarkets and Coop City department stores, making Coop the largest cash dispenser in Switzerland.

In addition to account solutions, Coop Finance+ also allows investments in pension solutions in the 3a pillar. These are launched with the Liberty 3a pension foundation, Glarner Kantonalbank as the custodian bank and asset manager, and Vanguard and OLZ as fund partners. Coop is currently offering an above-average interest rate of 1.4 percent for deposits into the 3a pension account.

While Coop’s return to banking is seen as a strategic move, it has also sparked criticism. Some argue that the decision is driven by the desire to profit from the lucrative banking sector, with managers benefiting from both the exit and re-entry into the business, while customers and employees bear the cost.

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