Why do people want to use Revolut? Comparing the European fintech unicorn with its US rivals
Revolut is a financial technology company that first came out four years ago in a business incubator in Canary Warf, London. It promises a world beyond banking, with simple and easy to use solutions for your financial needs and digital services that suit your lifestyle. But it isn’t the first or the only fintech company to make that claim. Fintech companies work in an environment that makes use of technology to improve financial activities. They all try to use the latest technology available to present you with the easiest to use financial products, ranging from mobile banking to cryptocurrency.
So does this European startup have what it needs to take on the US market, or will the competition be too tough?
Revolut was founded by Nikolay Storonsky and Vlad Yatsenko as an alternative to traditional banking products with more control, more flexibility and a more client-friendly approach to international money transfers. They took mobile banking platforms to the next level. Revolut offers global spending and transfers without miserly exchange rates.
You can spend money abroad without having to pay hidden fees. And you can do that by using your contactless, Revolt card. It will help you directly manage your exchange to and from over 130 currencies and help you stay clear of currency exchange offices with greedy rates.
Money can also be sent around the world with no hidden fees. It is practical and a fast, secure way of transferring money that uses much better rates than traditional banks.
This means fewer things for you to worry about on your trips and holidays abroad. Right now you probably have to use your card and pay fees to both your local bank and to the bank who owns the ATM, for the money you are spending on a city break in Paris. With both leisure and business travel growing every year, Revolut seems to have come up with a way for you to avoid all this unnecessary hustle. And that has brought in a lot of clients that enjoy its ability to transfer money almost instantly and with little cost. Over 5 million so far. As well as more than 350 million transactions worldwide.
And they don’t shy from the crypto market either. The company has been one of the first to combine traditional currency banking services with cryptocurrency. Revolut allows you to exchange for crypto at a very low fee. A 1,5% fee of the rate given by Bitstamp, the world's longest-standing crypto exchange.
Albeit this feature is reserved for users of the premium service you can also instantly change your money into Bitcoin, Litecoin, Ethereum, Bitcoin Cash and XRP and transfer them to other Revolut users instantly and without any fees. And it has access to real-time rates and alerts.
The Revolut app will also help you stay on budget at all times with instant payment notifications that will tell you where and how much money you spend. Also, you can use a feature where the system rounds up your purchase every time you use the card and sends the money to your savings account.
The app will also help you set up your monthly budget. Just insert the amount you want to spend each month and it will work out a daily spending limit you should stick to, to meet your goals.
You can buy overseas medical insurance directly from the app with the help of the Pay-per-Day tab you will find in your app. Or even mobile phone insurance if you like too.
Revolut is completely Apple pay ready. So you can add your Revolut card to make fast secure payments.
When it comes to security you should know that all your Revolut card transactions are processed by the Mastercard, Maestro, or Visa network and are protected by Mastercard, Maestro, or Visa rules. The company protects both your confidentiality and the security of your information, including your non-public personal information. Client funds are stored under a segregated trust account at Barclays/Lloyd's and Revolut safeguards your funds as per FCA requirements, the Electronic Money Regulations 2011, and the Payment Services Regulations 2017.
Revolut is not the first of the new European digital financial service providers that are looking to expand in the US. Monzo, another British based fintech company, has already announced that it would begin offering its services in California. No date for the launch has yet to be released but there is no doubt it will take place sooner rather than later as Monzo has already signed an agreement with Sutton Bank (Ohio). And they are not alone! N26 a German self-styled mobile bank is also planning on getting a share of the market.
See also: IS IT STILL WORTH INVESTING IN BITCOIN IN 2019? HERE'S WHAT EXPERTS HAVE TO SAY
Competitors from Europe are nothing that Revolut hasn’t seen before. But American competition may prove harder to dislodge. First of all, the fintech industry is pretty big and equally big players are already dominating key areas. Take PayPal, a juggernaut of worldwide money transfer. Or SoFi another digital platform-based financial service, that made a name in providing student loans, refinancing or personal loans. Revolut does not operate in all of those areas nor does it rely solely on one of them, but it could see its eventual business expansion thwarted by US rivals operating the same niche.
Chime and Aspiration Bank are two of those companies. So let’s take a look and compare their current offers:
This app based banking service was launched in 2014 and managed to raise well over $100 million in funding. It is said to have reached around 4 million users as of mid-2019 and looks hell-bent on not stopping there.
Similar to Revolut they have an easy to use app, with a clean comprehensive design and many equivalent features. Chime promises to free you from unnecessary fees: No overdraft, no minimum balance, no monthly fees, no foreign transaction fees. 38,000+ fee-free MoneyPass and VisaPlus Alliance ATMs. Also similar to Revolut, Chime offers in-app possibilities to organize your budget, save money and benefit from transaction alerts. And according to them, their system is so much faster than traditional banking that you can use your pay check up to 2 days faster than your co-workers. All that means is the payment is instantly processed and you don’t have to wait for traditional bank payment processing.
Be aware that ATM withdrawals will come with a fee when out-of-network. The app does not take well to crypto either as it will not facilitate you buying, transferring or exchanging virtual currency.
They do however let you open a savings account, and in a similar way to Revolut, anytime you spend money, the purchase will be rounded up to the nearest dollar. That money is subsequently credited to your savings account.
Aspiration styles itself as a financial partner. As with Revolut or Chime, they want to be an alternative to traditional bricks and mortar banks. And they are so serious about that, they say you will never pay ATM fees again. A feature that applies world-wide!
Aspiration combines banking services with social responsibility and investment opportunities. It is your online banking service provider with a heart. It advertises its banking services as being socially responsible and they do really seem to be that way when compared to other similar companies.
The MasterCard that they issue with the account comes with no overdraft fees, check deposit fees, debit card fees, or account inactivity fees. You get cashback rewards on every purchase you make, bonus rewards for spending at socially-conscious businesses and complete assurance that your deposits don't fund fossil fuel projects. Aspiration also pledges to commit 10% of their earnings to charity.
Similar to Revolut it does have Cell phone insurance but as an extra, you can get identity fraud expense reimbursement as well.
In the end, it’s up to the consumers to choose which one of these financial instruments suits them the most. All of them have comprehensive things going for them. And they all seem to expand into segments that are untapped by the competition. In a highly competitive market, the digital banking company that will best predict the needs of its users will come on top. Maybe none of these three will eventually be the one that leads the way in the US fintech services market, but Revolut’s eventual arrival will surely stir up the game.
So does this European startup have what it needs to take on the US market, or will the competition be too tough?
Digital banking and more
Revolut was founded by Nikolay Storonsky and Vlad Yatsenko as an alternative to traditional banking products with more control, more flexibility and a more client-friendly approach to international money transfers. They took mobile banking platforms to the next level. Revolut offers global spending and transfers without miserly exchange rates.
You can spend money abroad without having to pay hidden fees. And you can do that by using your contactless, Revolt card. It will help you directly manage your exchange to and from over 130 currencies and help you stay clear of currency exchange offices with greedy rates.
Money can also be sent around the world with no hidden fees. It is practical and a fast, secure way of transferring money that uses much better rates than traditional banks.
This means fewer things for you to worry about on your trips and holidays abroad. Right now you probably have to use your card and pay fees to both your local bank and to the bank who owns the ATM, for the money you are spending on a city break in Paris. With both leisure and business travel growing every year, Revolut seems to have come up with a way for you to avoid all this unnecessary hustle. And that has brought in a lot of clients that enjoy its ability to transfer money almost instantly and with little cost. Over 5 million so far. As well as more than 350 million transactions worldwide.
And they don’t shy from the crypto market either. The company has been one of the first to combine traditional currency banking services with cryptocurrency. Revolut allows you to exchange for crypto at a very low fee. A 1,5% fee of the rate given by Bitstamp, the world's longest-standing crypto exchange.
Albeit this feature is reserved for users of the premium service you can also instantly change your money into Bitcoin, Litecoin, Ethereum, Bitcoin Cash and XRP and transfer them to other Revolut users instantly and without any fees. And it has access to real-time rates and alerts.
The Revolut app will also help you stay on budget at all times with instant payment notifications that will tell you where and how much money you spend. Also, you can use a feature where the system rounds up your purchase every time you use the card and sends the money to your savings account.
The app will also help you set up your monthly budget. Just insert the amount you want to spend each month and it will work out a daily spending limit you should stick to, to meet your goals.
You can buy overseas medical insurance directly from the app with the help of the Pay-per-Day tab you will find in your app. Or even mobile phone insurance if you like too.
Revolut is completely Apple pay ready. So you can add your Revolut card to make fast secure payments.
When it comes to security you should know that all your Revolut card transactions are processed by the Mastercard, Maestro, or Visa network and are protected by Mastercard, Maestro, or Visa rules. The company protects both your confidentiality and the security of your information, including your non-public personal information. Client funds are stored under a segregated trust account at Barclays/Lloyd's and Revolut safeguards your funds as per FCA requirements, the Electronic Money Regulations 2011, and the Payment Services Regulations 2017.
The US market
Revolut is not the first of the new European digital financial service providers that are looking to expand in the US. Monzo, another British based fintech company, has already announced that it would begin offering its services in California. No date for the launch has yet to be released but there is no doubt it will take place sooner rather than later as Monzo has already signed an agreement with Sutton Bank (Ohio). And they are not alone! N26 a German self-styled mobile bank is also planning on getting a share of the market.
See also: IS IT STILL WORTH INVESTING IN BITCOIN IN 2019? HERE'S WHAT EXPERTS HAVE TO SAY
Competitors from Europe are nothing that Revolut hasn’t seen before. But American competition may prove harder to dislodge. First of all, the fintech industry is pretty big and equally big players are already dominating key areas. Take PayPal, a juggernaut of worldwide money transfer. Or SoFi another digital platform-based financial service, that made a name in providing student loans, refinancing or personal loans. Revolut does not operate in all of those areas nor does it rely solely on one of them, but it could see its eventual business expansion thwarted by US rivals operating the same niche.
Chime and Aspiration Bank are two of those companies. So let’s take a look and compare their current offers:
Chime
This app based banking service was launched in 2014 and managed to raise well over $100 million in funding. It is said to have reached around 4 million users as of mid-2019 and looks hell-bent on not stopping there.
Similar to Revolut they have an easy to use app, with a clean comprehensive design and many equivalent features. Chime promises to free you from unnecessary fees: No overdraft, no minimum balance, no monthly fees, no foreign transaction fees. 38,000+ fee-free MoneyPass and VisaPlus Alliance ATMs. Also similar to Revolut, Chime offers in-app possibilities to organize your budget, save money and benefit from transaction alerts. And according to them, their system is so much faster than traditional banking that you can use your pay check up to 2 days faster than your co-workers. All that means is the payment is instantly processed and you don’t have to wait for traditional bank payment processing.
Be aware that ATM withdrawals will come with a fee when out-of-network. The app does not take well to crypto either as it will not facilitate you buying, transferring or exchanging virtual currency.
They do however let you open a savings account, and in a similar way to Revolut, anytime you spend money, the purchase will be rounded up to the nearest dollar. That money is subsequently credited to your savings account.
Aspiration Bank
Aspiration styles itself as a financial partner. As with Revolut or Chime, they want to be an alternative to traditional bricks and mortar banks. And they are so serious about that, they say you will never pay ATM fees again. A feature that applies world-wide!
Aspiration combines banking services with social responsibility and investment opportunities. It is your online banking service provider with a heart. It advertises its banking services as being socially responsible and they do really seem to be that way when compared to other similar companies.
The MasterCard that they issue with the account comes with no overdraft fees, check deposit fees, debit card fees, or account inactivity fees. You get cashback rewards on every purchase you make, bonus rewards for spending at socially-conscious businesses and complete assurance that your deposits don't fund fossil fuel projects. Aspiration also pledges to commit 10% of their earnings to charity.
Similar to Revolut it does have Cell phone insurance but as an extra, you can get identity fraud expense reimbursement as well.
In the end, it’s up to the consumers to choose which one of these financial instruments suits them the most. All of them have comprehensive things going for them. And they all seem to expand into segments that are untapped by the competition. In a highly competitive market, the digital banking company that will best predict the needs of its users will come on top. Maybe none of these three will eventually be the one that leads the way in the US fintech services market, but Revolut’s eventual arrival will surely stir up the game.
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