The bigger neobanks prepare for further global expansion and the smaller ones expand locally.
Welcome to Neobanked, a newsletter focused on the quickly evolving UK digital banking market. I hope to gather enough interesting tidbits and news to share this every two weeks.
For me, Neobanks are digital-only offerings that apply internet economics (i.e. zero marginal costs) to the banking sector. My focus will be on companies such as Monzo, Revolut, Starling, and N26.
Through this newsletter I hope to cover each of these companies as they continue to grow within the UK and beyond. Some of the regular features will include user number growth, new product/feature releases, and links to relevant interviews and analysis.
News this week
Curve’s long awaited support for Apple Pay has now been rolled out to customers. The over-the-top card allows any card connect to the service to work with Apple Pay (both NFC and Apple Pay online); this includes cards who have. It yet enabled the functionality themselves.
Monzo’s CEO has met with executives of the SoftBank Vision Fund to raise as much as £100m. This funding will primarily be used to build the US operations.
The bank has partnered with Brightside, a social mobility charity, to launch a pilot program called Money Hacks for pupils in North London schools to receive financial management education.
Revolut’s European payments operations will move from London to Ireland and Lithuania as a result of Brexit. Revolut has said they will pursue a three license model - central and eastern European customers will be served by the Lithuanian license, western European customers by an upcoming Irish license, and UK customers by a UK license.
New and upcoming feature releases
Starling’s business-focused marketplace has added Milo (an online buy-to-let mortgage lender), UnderPinned (freelancer career platform), and PayStream (digital accounting services for contractors).
A change in EU regulation has pushed Monzo to remove ATM fees and limits in the European Economic Area.
Brexit’s impact is beginning to be felt by the neobanks but internationalisation remains a top priority. Ireland is likely to benefit from the newly created borders. For some, there is still plenty of work to do in proving the UK model works and building the product portfolio and brand to appeal to a wider customer base.