Carsten Höltkemeyer, the German CEO of Berlin-based Banking-as-a-Service (BaaS) startup Solaris, values the English mentality, especially their humor and ability to laugh at themselves. His career has involved significant interactions with British financial institutions, reflecting his belief in continual self-development. Höltkemeyer’s professional journey has seen numerous changes, and his current role at Solaris exemplifies his commitment to transforming businesses and fostering growth.
Professional Journey
Höltkemeyer’s extensive career began as a PWC auditor, followed by senior finance roles at Commerzbank, Royal Bank of Scotland, and Barclaycard. Shifting to fintech in his fifties, he chaired the supervisory board of German digital lender Auxmoney before joining Solaris as CEO in 2021. The fintech world’s dynamic nature appealed to him after experiencing limitations in traditional banking due to legacy systems.
Athletic Side Hustle
Besides his professional pursuits, Höltkemeyer was a board member at FC St Pauli until recently. His departure coincided with the team’s promotion to the Bundesliga, ending a 14-year absence. This humorous association with the team’s success showcases his light-hearted approach, complementing his professional seriousness.
In recent years, Solaris emerged as a prominent player in the BaaS sector, achieving a unicorn status with a valuation of €1.6bn. Despite its success, the company has faced regulatory scrutiny from the German regulator BaFin, reminiscent of the challenges financial institutions faced with Wirecard’s collapse. The fintech industry has seen heightened vigilance, impacting companies like Solaris, which must adhere to stringent compliance measures.
Solaris, founded in 2015, has established itself as a significant BaaS provider in Europe, backed by notable investors such as Visa and Spain’s BBVA. However, regulatory challenges have persisted, with BaFin imposing deadlines for improving anti-money laundering controls. The company’s experience mirrors broader trends in the fintech sector, where regulatory compliance continues to play a critical role in operational success.
Solaris’s Market Presence
Solaris offers white-label financial services like debit and credit cards, KYC, and digital banking solutions to various fintech and corporate clients, including Naga Pay and Vivid Money. Its comprehensive suite of banking products, facilitated by holding a German banking license and an EMI license, positions it competitively in the market. The company’s ability to pass on a percentage of deposit interest to customers adds to its appeal.
Regulatory Compliance
The German regulator BaFin has scrutinized Solaris, threatening fines if the company fails to improve its anti-money laundering controls and other regulatory requirements. A special monitor overseeing Solaris’s progress has extended its mandate, limiting the company’s ability to onboard new clients without regulatory approval. This scrutiny follows a broader trend of increased regulatory vigilance in the fintech sector.
Höltkemeyer’s experience in traditional banking is instrumental as Solaris navigates regulatory challenges and aims for profitability. The company reported annual losses of €56mn for 2022 but is on the path to profitability, with predictions for improved financial performance. Compliance with regulations is critical for Solaris to maintain its reputation and continue providing robust banking products to corporate clients.
