Given the ever expanding number of Fintech companies there are these days, just how many of them can you see surviving into the future?
From memory, I can think of a few we have already lost here in the UK.
N26 (although still active in Europe)
Bo (probably a non starter)
Boon
Wirecard (Now where did I put that £2 billion? )
Of those that are pretty established here, I can still see a few disappearing due to lack of funding, low customer uptake, or through sales, acquisitions and mergers.
Curve - Despite their pretty unique USP, I just don’t see them being around for the long term
Currensea - Too many alternatives now which are much cheaper
WeSwap - As above
Monzo - I know this will be a controversial one, but I can see them being acquired by a larger organisation looking for an easy way into the financial tech market
I think the bigger ones a relatively safe, longer term, but I think their survival will rely heavily on the absence of Apple and Google competing, and there are signs, and inklings, that those tech titans may one day join the market properly.
N26 may have pulled out of the UK, but they’re quite a well established bank in the rest of Europe and are rolling out globally too. I think they’re here to stay.
I think Monzo and Starling are here to stay too. Financial woes aside, I don’t see them going anywhere. Monzo are, as you say, a very tasty looking acquisition target. I can see a tech company trying to buy them, but not so much a bank. Their outlook seems a little more optimistic now that I think would rule out a potential merger with another fintech that really needs a license, like Revolut, or N26.
Goldman Sachs are going to be a very interesting player in the longer term I think. I could see them perhaps buying up a fintech or two to help elevate their goals.
You make a good point there.
As far as acquisitions go, one of the limits would be the purchase price.
The likes of Goldman Sachs are perhaps one of the few company’s who have the funds to make it happen.
I think Apple could definitely perhaps compete one day as they are doing the whole Apple Cash thing as well as the Apple Card, but Google has shown their play is integrating banking apps into Google Pay and giving a lot more data about transactions etc and using their expertise in data processing probably to a) serve you ads and b) enrich your banking experience
And… Apple only control half the phone market in the U.K.
But if Google Pay can put RBS or Lloyds on it, that’s 99.9% of the reasons to use Monzo or Revolut. The tech is handled by Google and sure it may be preference at that point, but my lord is inertia powerful
Google’s an interesting one here. Personally I just see what they’re doing now as dipping their toe in the water, rather than their end game service. A bit like Apple Cash Card was for Apple before they dove in with a credit card. I don’t think it’ll stop with the credit card for them either. Apple are starting to show an interest in crypto now too.
Let’s not forget Samsung either, they’ve shown some interest in fintech too. Amazon are definitely interested here too.
It’s going to be a very interesting decade for fintech! I imagine if not for so many regulatory hurdles in so many countries, we’d have a lot more on offer.
I hope you’re not right, if only because I’ve just thrown a few quid into their latest share issue (second time around).
Curve have just one big problem, I think… the inability to catgeorise or flag specific recurring transactions or classes of transactions into the future. If they were able to implement this it would really take off, I believe. It’s the lack of certainty about what card will be charged for delayed transactions that stops people using them for anything other than one-off transactions that will be processed immediately.
Then it would be like an email forwarder allowing the consumer to change provider without the admin hassle.
As the product currently stands there are real obstacles to growth and usage, but small developments in the facility could make a huge difference to usability and profitability. I also think that UK-based consumers are somewhat spoiled by the advanced state of payment systems. They might be more attractive in other markets, even with the current offering.
I’d like to be proved wrong too.
No way I want to see any business fail.
Maybe they need to have a bit of a rethink about their business model.
At the moment though, I just can’t see how they are going to become profitable.
I’m wondering if any of these budgeting-based fintechs will come forward with the option to ‘turn off’ or hide the budget tools?
For me, at any rate, the visibility of budgeting stuff is a big turn off and stops me giving anything like that a real try-out. (I think I said in another thread that I use YNAB for budgeting and having an open banking connection into that is the most I want from an account.)
I know the budgeting stuff is designed to make the account sticky and draw you into its clutches. But that’s quite a high initial bar, if an app is only attractive or useable if you throw everything in there from the beginning. I wonder if casual use first isn’t a way to go, bigger numbers even if less enagaged?
I would also like a “currency pass-through” mode, allowing you to select pass-through for certain cards to get Curve to recharge the underlying card in whichever currency you had originally used.
This would be very beneficial for accounts where you already have fee-free foreign transactions, at Mastercard or Visa conversion rates. This is currently possible with Curve but you always have to manually change the currency first. Manually changing it also messes up any recurring transactions set up for Curve from back in the U.K. as well, although your suggestion may be able to mitigate this. Still, an auto-mode for currency would be great!
Curve have said they are trialling an autopilot feature to allow you to designate a card for recurring payments and direct debits, and also select for a particular merchant. If they did this, you could change the default currency in Curve knowing it won’t impact UK recurring payments. No mention of currency passthrough though.
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