FinTechs, survival of the fittest

Originally posted on Monzo forum, but as the good folk here seem to have more diverse views, I thought I’d try again

It seems that these days, every time you read the news, another FinTech challenger has emerged.
While many of them have been around for a few years now, some are only just entering the market.
Some very innovative, others just looking for a solution to problems that don’t really exist.
Whilst I applaud all of their efforts to shake up the financial industry, I can see some of them falling by the wayside, especially when the investment cash starts to run out, they fail to make a profit or customers dry up.

Which, in your opinion will be the FinTechs and challengers that will survive, and which do you think will fail, and why?

Here are my thoughts about some of the FinTechs I have knowledge of::

The obvious survivors (in no particular order)

Starling, Monzo - Probably the best known proper UK digital banks with a healthy customer base

N26 - Already well established in Germany, and they may possibly make some inroads into the UK and US markets, although I can see this being a small number

Revolut - One of the best multi currency accounts on the market, and available throughout Europe, and quite a few other countries

Transferwise - One of Revolut’s main competitors, and again pretty well established in the international transfer market

Monese - Not the largest market share, but a pretty solid product and the ability to have a separate card for the euro account

Ones I don’t think will make it:

Curve - Don’t seem to be moving forward, and I see little value in their current product

Currensea - A card created for a problem that doesn’t really exist any more, 0.95% mark up for using your own money

Boon, Koto - Just a virtual card that is linked to a digital wallet, no phone, no payment method. At least the likes of Revolut, Monese, etc., offer a physical card too, and they have been going a lot longer

I know there are many more, but I didn’t want to make the post too long winded, although I will hopefully add more comments when I have learnt more about some of the other FinTechs I am currently experimenting with.

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Judging only by what I read here and in the financial press, Revolut seem to be lurching from gaffe to gaffe lately, with the accrued negative press. They will need to build some corporate gravitas to be seen as a palatable mainstream player.

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Revolut Bank will be the one that survives.

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Interested to know why you think that…

All I know is that it’s going to be an interesting year for Metro Bank, although that’s more challenger than fintech?

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N26 showed its colours and despite a noisy, promising lead-up to its UK launch, has proved to be a very luke-warm offering to its UK customers.

A unique player in the UK, it’s potential to be an invaluable addition to your wallet has been sorely hit by Amex terminating it’s relationship (that was a real turn-off for a large section of its customer base.
The product has been further hampered by poor customer service and iffy comms. A shame…

It’s multi currency wallet is surely valuable for frequent world-wide travellers. They’ve made some efforts with their app but I wouldn’t trust them with my full account.

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I don’t really thing we have seen anything exciting yet. A few of them are obviously going to do well, revolut, starling and monese, all offer something unique and have built up a user base which seems no sign in stopping, they all have plans to expand carefully not rushed like some.

As for the prepaid players, prepaid is never anything interesting, there are only 5 suppliers operating in the UK so all the new prepaid banks use one of them, the app might be a bit fancy but the restrictions are always there.

You have the likes of dozens though which seems to want to be different that could be interesting when it’s got the basics like direct debits and standing orders.

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Woah that’s actually incredibly similar to my thoughts - Revolut, Starling and Monese all have a very clear market

Revolut / amazon of finance but clear USP of the 0% leading FX rates and multiple currency lock-in at said rates which post office etc can’t offer while offering premium plans that offer clear value for the user base (1% cashback will literally cover the entire sub if you travel often)

Starling - traditional banking but with partners to add the bits that a retail bank doesn’t want to touch or has no business going near (like Flux or insurance)

Monese - those who have identity cards from other countries and need an account quickly to get paid in the U.K./EU as well as would vastly prefer native language customer support as well as the ability to have a card in your home country currency and making it easy to send money home etc

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I do have a Dozens account, but as yet haven’t used it.
Their bond issues, while imaginative are hardly going to set the world alight if you are limited to buying small amounts.

The bonds are not the key to what they are wanting to be about, its about saving, budgeting, awarding savers and so on. Investing in the same app, saving in the same app, having your current account together, all the while having budgeting and seeing where you are.

The bonds are just an initial thing to make you use them.

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On the subject of trying to do something different, anyone have any thoughts on Tally Money??

I can’t answer without swearing lol

It’s worthless and I can’t see what the hell people like about it.

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Brilliant, exactly what I was after, all opinions no matter how good or bad.

Wasn’t there something similar to Tally that went bust recently?

Glint? They went into administration and then got some more funding - so they’re out of the lurch now

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Just realised, I missed out some of the FinTech credit cards on my original list

Tandem - A good offering with their cashback and fee free spending, although I will reserve judgement on the new “Tandem Membership”

Tymit - I really cannot see what makes them stand out. I see no benefit in being able to split payments into instalments, except for those who don’t know how to use a credit card responsibly,. the only perk I see is making more money from interest for the card company.
Oh, and the waitlist seems to be about 3 years :rofl:

JaJa - I have applied, and am still waiting for my invite, but apart from instant notifications, I can’t see any other benefits setting it apart from your bog standard credit card.

On the whole, I don’t see any of these credit card FinTechs making any real inroads into the established market, except maybe Tandem

Other features not commonly available on other cards include:

  • Instant balance updates (I mention this because some cards provide instant transaction notifications without instant balance updates).
  • Transaction search feature - maybe unique among credit card apps ???
  • No cash withdrawal fee
  • Fee-free foreign spending

Also…

I believe transaction enrichment is in the pipeline.

They’ve talked in the past about some kind of credit sharing feature, although seem to have gone a bit quiet on this.

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Tandem has the worst customer service of any bank or card company I’ve ever come across, the offer no help, not even basic help unless you go through verification, they randomly block your card for suspicious transactions despite you using the card in the same places at the same time., I don’t use mine anymore, but retried if not so long ago and the problems are still there A simple phone call was a nightmare.

I have had my card since the very first days, so have had lots of experience with them, I keep expecting them to improve a lot but they don’t.

If I counted how many times I’ve had my card blocked with them we would be in double figures.

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Sorry, do you mean new day?

They actually make me wheeze

I call up to tell them that at first I received a letter saying basically “fill out this for a dispute”, this came with a “mail me back” letter

I call up when the merchant says no, after being sent a letter saying I had 14 days to provide back a letter

I call up on day 13 to tell them that I’ve received no letter inside which would let me return it easily

Day 20 or so I’ve finally had the time to go to a post office to buy a stamp and find an envelope (I work late shifts + have university in the day, so I’m either sleeping or busy or the shops are shut)

They told me they couldn’t revert it until the evidence had been submitted, so I need to call them up before I go to bed today (probably in an hour when they’re open)

My god they’re making me angry though - I’m half tempted to apply for an IHG card and just ignore Aqua entirely if they’re going to keep this up

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Thanks for that, I somehow missed the “instant balance” feature when I was reading up on them.

Sorry to hear you have had problems with Tandem’s C/S
I can only speak from personal experience, and the 1 time I had to contact them my problem was sorted very quickly.