Banking on-the-go: mobile-only apps for smartphone users

23 September 2016

Hate going to a bank and interacting directly? Don’t worry – there is a new breed of digital mobile apps offering a completely different approach to conventional banking. Accessible 24/7, they enable users to manage their account settings, transfer money from one account to another, pay bills, create recurring payment plans, check account balances or get instant notifications without interrupting the rest of their life. Now you can keep your financial life in your hand, bag, pocket, or wherever your mobile phone is!

The online banking environment is constantly evolving to meet customer demands for convenience and flexibility. Besides traditional apps from big-name banks like Chase, HSBC or Capital One that offer mobile activities in addition to their existing infrastructure, there are also Apple and Android mobile-only apps from financial institutions that operate online and don’t have any physical branch offices or vast call centers. This low-cost business model allows them to offer better terms and rates than classic banks.

Banks for people who hate going to a bank

Fidor Bank

Founded: 2009
Founders: Matthias Kröner, Dr. Michael Maier, Steffen Seeger and Martin Kölsch

Fidor Bank is an innovative online-only bank founded and licensed in Germany and offering many useful financial services to customers from Germany and now from the UK. Fidor has no sales staff; they promote their products and services online via social networking sites. After installing the Fidor app, you can apply for a Smart Account requiring video identification through a mobile phone camera.

Banking on-the-go

The Fidor Smart Account enables customers to transfer money to other accounts, make payments, send money to the European Economic Area, and earn a competitive interest rate on their account balances – currently, 0.3%. The more likes the Fidor UK page gets on Facebook, the higher the interest rate goes. Fidor bank has also become the first bank to integrate the Ripple blockchain-based protocol for money transfer services.

Simple

Founded: 2009
Founders: Alex Payne, Joshua Reich, Shamir Karkal

Simple is an all-digital US mobile financial services provider offering customers to open a checking account and order a Visa debit card through their mobile app for Android or iOS. It is also possible to make instant money transfers to other Simple accounts for free. Another popular Simple’s feature is their Goals budgeting tool that lets set aside a small amount each day to fill a personalized savings goal.

Simple is famous for their fee-free philosophy: the company doesn’t charge most common banking fees, like account maintenance fees, ATM Fees, overdraft fees, or minimum balance fees. On the other hand, Simple offers just a 0.01% interest rate on customers’ balances, so this smart banking solution is not for people looking for high-yield savings accounts.

Atom Bank

Founded: 2014
Founder: Anthony Thomson

Atom is a UK-based startup mobile bank offering smarter, cheaper, and more innovative financial services for UK citizens. The company is just at the beginning of the journey: currently, only pre-registered customers can download their iPhone and Android app and login using an invitation code. Atom uses voice and face biometrics (a selfie or a voice clip) to verify the identity of their users.

First Atom customers opening an account will automatically become the Founder Programme members that can test all new products and services before they become publicly available. Currently, the bank offers fixed-term savings products: a 1 year plan with a 2% interest rate and a 2 year plan with a 2.2% interest rate. By the end of 2016, Atom is planning to provide business loans and residential mortgages.

Monzo

Founded: 2015
Founder: Tom Blomfield

Previously known as Mondo, Monzo is a London-based app-only newcomer famous for its record-breaking crowdfunding campaign – in February 2016, they managed to raise £1 million in just 96 seconds. It shows that modern customers are highly interested in a fresh mobile-centric banking experience – more personalized and more responsive to their everyday needs.

Monzo has a full banking license with restrictions, so they can’t offer a full range of banking products. The company currently focuses on personal accounts and issues limited-edition Alpha and Beta prepaid debit cards for testing purposes for people living in the UK. It is reported that Monzo card users have already spent over £20m using their plastics.

Moven

Founded: 2011
Founder: Brett King

Movenbank is an online American financial services provider offering a wide range of digital products and services to people living on their smartphones:  bank accounts (you can deposit up to $25,000 per month), Moven debit cards, instant spending alerts, budget visualization tools. However, Moven doesn’t pay any interest on current account balances and doesn’t support wire transfers.

In addition, Movenbank also enables customers to make mobile “tap-to-pay” payments using the Near Field Communication (NFC) technology. They provide special payment stickers that users need to place on their mobile devices to pay for goods and services in all locations where MasterCard PayPass is supported.

 

Brett King

The age of mobile access opens the door for forward-thinking digital-first financial institutions to enter the market. EBay has changed shopping, Uber has changed transportation, and now it’s time to change banking. People often get frustrated if they need to wait more than several minutes to get things done, so the new wave of mobile-only banks relying on the increasing use of digital technologies can become a promising alternative to the established lenders, especially for young generation.

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