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Fintech Banks. What's Out There?

finance
fintech
#1

So i’m curious of two things. What fintech type banks are people aware of if any elsewhere in the world, and do you use them?

In the UK, there are two main ‘fintech’ (challenger) banks who provide current and/or business accounts, Monzo and Starling Bank.

Both consider themselves “digital” banks in that they have no branches. Starling utilise the Post Office to facilitate cash deposits for example, and mail for cheques (no cheque imagine yet. Both of these banks also primarily focus on offering current accounts. Thoguh Monzo offer savings through 3rd party partners, and Starling offer Euro and business accounts as well.

Starling have an interesting card for those curious.

There’s also Metro bank here which is quite new but operate more like a traditional bank with branches and a full product range.

I know in the rest of the EU there’s N26 (they also recently offered a UK account. But i’m not familiar with what else is out there in the rest of the world.

Are there new “challenger” banks popping up elsewhere in the world? Do you use any of these new banks?

I quite like starling, and their fresh technology stack seems to allow them to move faster and implement banking features that line up with the 21 century.

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#2

Bloomberg talks often about fintechs.

Here are some:

bloomberg.com/news/articles/2019-07-18/thiel-backed-fintech-n26-valued-at-3-5-billion-amid-u-s-launch

https://www.bloomberg.com/profile/company/0777864D:LN

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#3

Transferwire seem relatively popular in the UK for people exchanging money for use on holiday etc.

Another one is Revolut, also popular for use in other countries with different currencies. They technically offer a current account, but people only really use them for spending abroad. Starling also used to partner with TransferWire to offer currency exchange in app, they still offer currency exchange but no longer use TransferWire.

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#4

In the usa here is what i know of
For a savings accounts and investing there is betterment, robinhood and wealthfront.

Ally Bank is one of the oldest one interms of all purpose online bank.

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#5

I tried to google if there’s any new banks emerging in Finland can be called fintech banks, but didn’t find any.

I have noticed old major banks have invested phone applications and so on, and electronic money transfers and e-invoices are really common here. For example only select few bank offices of Nordea bank offer old fashioned cheques.

One extremely handy app that I’m using is the “wallet” phone app that allows me to keep track how much I’m spending on groceries, household supplies, gas, and so on.

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#6

Downside from these apps is that you accept whatever new terms they put in, and me not accepting these Nordea terms were the only reason I had no strange fees my other family members had

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#7

Wired UK did a bit on Resolute and their possibly shady hiring / onboarding / ponzi growth scheme…

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#8

On the savings side there are a few ‘traditional’ style newcomers in the UK. Atom Bank, Charter Court, Oak North could all be considered fintech/challenger banks. With Oak North specifically having being digital as a point of their company.

They all do well. Oak North apparently being the first digital bank to report a profit.

In the UK we also last year got Marcus savings accounts, thats Goldman Sachs consumer savings brand. It was received well. Id probably also consider this a “fintech” product.

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#9

They’ve been in the news recently i think with some concerns, though im not overly familiar with the details.

On money tracking apps specifically? They tend to have no access to actually bill you for anything, and have to also be covered at least in part by relevant financial regulations. But what they do with the data, may be a different story. However my understanding is that the protection of the data is still covered under financial regulations.

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#10

Here in the US there is USAA it is pretty old and doesn’t have branches. They do everything from banking, Mortgage, insurance and credit cards.

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#11

Oh. Speaking of the US. Monzo are planning an US expansion and have apparently partnered with a US bank to offer current accounts in the US.

Oak North also are apparently planning a US expansion as well.

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#12

I’m sure we’ve had a couple of credit card providers without banks, but I don’t think they do many products apart from credit cards?

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#13

The ‘fintech’ side usually also includes modern tech stacks and modern features, good apps (or sites in the case of Marcus) etc. Essentially embracing the digital over the paper.

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#14

Oh yeah I was just thinking that actual bank app, @Even747’s wallet thing is probs something else

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#15

Does somthing stop new banks from opening in the US?

Its interesting as this is a list of US ‘fintech’ companies. None provide current accounts or are actual banks.

In Europe there’s fairly strict financial regulations. The US i imagine is similar. Banks always use your data for analytics (always have) but there’s almost no way for them to actually share it as far as im aware.

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#17

Oh yeah, and as @Goalkeeper pointed out. N26 are also planning a US launch. So if you’re in the US you might be seeing new ‘digital’ banks pop up over the next few years.

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#18

To my understanding this is the case. Banks are (I think) by law required to conduct certain data analytics to prevent money laundering etc.

I’ve heard others say the same thing but for what ever reason I have not noticed any extra fees for using Nordea’s mobile apps or e-services.

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#19

Yeah, regulations will require certain checks of transactions. Banks will also tend to use transaction information to make business decisions, use the information to be able to offer loans, overdrafts, and mortgages, and in the case of banks with more up to date technology to do things like track spending, categorise transactions, budget, split bills, etc.

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#20

For investments, Robinhood and M1 Finance both count, I think. (Technically not “banks”, but they are SPIC-insured).

I find it a little weird that people equate internet-only banking and “fintech”. Some of the oldest banks have internet-only accounts.

Ally isn’t particularly new, they used to deal with auto financing under their old name: GMAC.

Discover (credit card company) offers some attractive savings account rates - internet only. Same with Barclay’s.

Banks do some interesting stuff on the backend, but the banking products that are offered to customers are so heavily regulated that they often complain it’s almost impossible for banks to differentiate themselves from the competition. I’d agree with that, for the most part.

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#21

Usually its the technology part more so than the internet, but since having physical buildings is a serious drain on cash (although Metro bank seem to have figured it out here in the UK), most of the new financial companies dont have customer accessible buildings, so internet only is generally a component of these new fintech services.

Some of the features of these new banks are some mundane things. Like freezing your card instead of only being able to cancel it, using your account before you even get your card in the post, being able to turn on and off things like location based security, magstripe payments, ATM use, etc.

Organising money via ‘pots’ instead of opening several accounts has made managing money automatically into smaller budgets for the future quite simple.

Some of these seem obvious but int he UK at least basically no bank did these, or if they did it was cumbersome and slow to make happen.

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