Fintech News


#1

This thread should serve as a place to post Fintech News.
The Competitor News thread largely serves that purpose, but this thread includes news about Starling as well.

Let’s start with some good news for challenger banks - Starling in particular, which at the moment is the only challenger bank included in the analysis. For every customer that left Starling, 6 others used the Current Account Switching Service to switch to Starling. Great times ahead.


#2

Don’t understand how Monzo isn’t featured. Something wonky there…


#3

I believe because their switching service did not launch until after the time of the report.


#4

I think that these statistics get monitored over a 12 month period.
Monzo’s CASS functionality only became available to the general public at the end of March.


#5

All of which suggests switching isn’t a good enough metric alone.


#6

Nope.
That alone isn’t.

It’s still encouraging to see though that the leaving vs gaining ratio is so high for Starling.


#7

You might be onto something here. Another site had a different take on this.

The quote in the article that stands out is

“There may only be 1,000+ accounts who have fully switched, but I’d suggest there are over a million zombie accounts from people who have left and not closed their accounts. These accounts are purely to fund people’s FinTech accounts …”

Also doesn’t include people who do a manual switch.


#8

I think you had to consent to them being released, i would presume Monzo would, unless it wasn’t great, and that would be the AMJ figures which would drop September.


#9

But yes, all in all, most encouraging. :grinning:


#10

Switching figures are published by the Current Account Switching Service.
If it was purely consent-based, I don’t think the likes of Barclays would agree.


#11

These are the overalls which includes April, May and June, it’s actually dropped from Feb and Mar, would people want to get in and switch before the end of the financial year?


#12

“Bacs is publishing the data below on behalf of CASS participants who have consented to its disclosure. This commercial data is owned by
the individual participants and any questions should be directed to the organisations concerned. This data will be published every quarter”
Page 4 of 5


#13

I personally don’t put much sway into switching figures. The simple reason is nearly always, the winners are the ones that offer the most, its not because they offer a good service or others offer a worse service, its because people follow money.

Nationwide, Halifax, HSBC, TSB all offered something more than the others, Offering someone £200 to switch is going to encourage lots of people. Offering 5% is going to encourage lots of people, even offering £125 will encourage people.

This years figures will be interesting, because at the start of the year banks really started trying to encourage people to switch.

The official report actually says as much

Focusing on the published gains and losses of participants in Q4 2017, the two biggest gainers were Clydesdale and Nationwide, potentially as a result of highly competitive switch incentives offered by both. Clydesdale offering £250 to new customers, and Nationwide offering £100 for the new switcher and a friend. Other
brands seeing net gains during the final three months of last year included Halifax, HSBC, Tesco and TSB, all of which offered various competitive propositions, including switching incentives and reward accounts.


#14

Yes indeed. Very definitely a big feature, as demonstrated by folk on both this and Monzo’s forum. That and the ease with which switching can occur. I guess a pill the banks have to swallow.


#15

Still long way to go for fintech challengers.

From Financial Times:

https://ftalphaville.ft.com/2018/07/25/1532517278000/UK-fintechs-aren-t-eating-the-banks--lunch-just-yet-/


#16

Not surprising given that fintechs’ is still tiny, whereas the top 4 banks control more than 70% of the market.


#17

Interesting to see those numbers. Revolut holds 0.3% of banking app usage with 1,000,000 customers whereas Starling holds 0.2%.

It’s a tricky one with Fintechs, on the whole people possibly use Fintechs more for travelling than day to day banking. A very obvious benefit being the free/cheap ATM withdrawals and overseas usage and exchange rates.

Perhaps then, most of the usage from Fintechs was not captured in this study, if it only looked at mobile users in the UK. I would strongly suspect most Revolut users predominatly used it when travelling outside of the UK. 0.3% of 1.5m is only 4,500 - so out of 1 million customers, only 4,500 users used the app from April to July. Seems incredibly low.

I believe the most Starling/Anne has ever said about the number of accounts is it’s in the “tens of thousands” (here). One could assume this is at most 99,999 users. Quite a bit lower than Revolut’s 1m+ - I’m sure once you got passed at least 150,000-200,000 users you’d start using “hundreds of thousands” rather then “tens of thousands” .

Starling users could be very diligent at checking their apps, or are in the UK much more?

Interesting.


#18

I struggle to find any reason why anyone residing in the UK would choose to use Revolut in their day to day spending. Just like you mentioned, it must be used primarily for overseas travel. However, I believe quite a few people in the UK use it for in-app currency exchange. Their interbank rates are the best you can find in the market.

Even more surprising is the fact that Monzo is not featured in top 3 fintech apps. It would suggest that with their 750 000 users (?) fewer people use their app than Starling’s? Astonishing.


#19

Probably 850,000 by the end of the day :wink:

https://publicstats.itxdev.uk/dashboard/db/monzo-current-acc?orgId=1&refresh=5m&from=now%2Fd&to=now%2Fd


#20

That article was 10 months ago. Customer numbers now must be in the hundreds of thousands. A lot happens in a year!