how can somebody explain Curve business model works
- how they make money?
I have approved this, but not sure if you missed more questions off of your list!
I understand they lose money on GBIT as they only get money off the merchant once but are charged by the underlying card provider twice!
I think the business model is the classic “freemium”, whereby standard free users generally make them no money at all but they hope, over time, that you will be converted into a paid plan user.
Presumably their paid plans are priced so that they always make a small profit on the services provided.
You’re right, but free Curve users will actually cost curve somewhere between 0.1 and 1% of txn value every time they use their card in the UK.
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And yet, their recent downgrade of the paid plans seems to have a lot of people downgrading to the free plan 
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They’ve attempted to fix that by further downgrading the offering of the free plan!
I know, due to the “double interchange” of Curve having to pay interchange for charging the underlying card (at high card-not-present, possibly credit and overseas card rates) but only getting paid at low personal debit interchange rates in most cases (except their commercial cards).
It doesn’t work. When they run out of VC it’ll get sold to people who scrap it (or change it significantly, to where it draws via an Open Banking API or something that costs a lot less), or it’ll go bust on its own.
I’d like it to keep going, it’s useful for lifting funds here and there. Not sure I’d pay for any of their current subs though!
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If you read reviews of people working there - the CEO doesn’t have a clue and recruits people from his background who also don’t have a clue.
I haven’t used mine in months. There’s no reason to. I suspect they will go down the Bunq route and get rid of the free tier completely, and thereafter crash and burn completely
It was supposed to make money by offering transaction data and deals with specific companies to give extra cashback - neither have happened.
It’s fundamental business model is a loss leader since it introduced personal cards - it was initially only available as a business prepaid debit and therefore attracted higher interchange fees that probably covered more of it’s costs.
I suspect that if they get rid of free, they’ll find that they’ve gotten rid of too many customers. Metal was great with the insurance but without that I’d be paying them £180 upfront to (hopefully) get It back via cashback over the rest of the year.
Instead, I’ve moved almost all spending to Amex and moved to Nationwide for the insurance. So instead of a typical £25 or so cashback from Curve by this point in the year, I have 59p. All of that from the 1% too as none of the cashback offers have been relevant to me.
I think that’s probably way too complex for Curve management.
I know. Shame really. I was quite happy paying ÂŁ180/year as I got more than that back in cashback so the insurance was free as were all the other benefits from Curve and because of it being World Elite (which saved me over ÂŁ1000 last year).
I used it to switch a large expensed meal from a credit card to a cashback debit card the other day - still has it’s odd uses
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Having relegated myself to the free plan, I accept that the only real attribute Curve has is the GBIT feature. Trouble is, the free card only permits 3 card swaps a month.
The paid cards have recently upgraded the benefits, doubling the number of merchants you can select for cashback purposes.
I’ve looked time & again at the cashback levels and even with the increased cashback, I’d pretty much only break even - so pointless. I have no need for the other benefits.
In reality I generally only use GBIT once or twice a month so free is OK for me on that score.
What I don’t see is how they convinced themselves that people would pay £180/year upfront only to receive it back again over the course of the following year.
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Exactly. I like having them around, but it’ll be interesting to see with this business model takes them.
Might be taking them to receivership which would be sad for a company that seemed so promising at the start.
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I think it’s still possible for Avios collectors to make more than £180 by using the £3k per month fronted allowance. But it depends on other factors such as which Avios card is in use (which may have it’s own fee) and if you would have had that card anyway without Curve.
I downgraded from Metal to free as I could not find a way to make it profitable for me but I’m not using Avios.
Presumably that’s the 1p+ valuation which airmiles collectors use, rather than the 0.66p (via Nectar) floor valuation for people who prefer to look at real-world savings? (I.e. don’t consider first class flight redemption face value a genuine saving since they’d have flown economy/with another carrier without)