In these days of Quantitative fiat, IOU is king. I opened business and personal accounts with Revolut and my first impressions were very favourable. Meanwhile, Monzo has now lost one of its key revenue sources, after regulators stepped in to stop them charging a steep 50p daily fee for unplanned overdrafts. That could force it to think about scaling back existing growth projects. Starling, Monzo and Revolut have started to dominate the scene, accompanied by an abundance of trading news and investment updates. Monzo’s unit-economics has improved such that each account now generates £4 in profit a year on average, when accounting exclusively for client servicing costs (rather than total costs, which include everything from salaries to marketing). Starling -v- Revolut £-€ quick comparison. Maybe Starling or Monzo aren’t right for you? And I think that’s going to be tough for Monzo.”. “The reality is all of these companies are making 20 to 30 bucks a year per customer. A tale of two banks: Monzo vs Starling. As noted above, 63% of Revolut’s revenues came from interchange while 55% of Monzo’s did. Starling is also technically acquiring customers the fastest in the UK, when adjusting for its age, as shown in the graph below. Startup Europe. “Something which stood out for me from the latest annual results is that Starling’s deposit per customer is £999,” said Levine. As noted above, 63% of Revolut’s revenues came from interchange while 55% of Monzo’s did. If you’ve followed me for any length of time you will probably know that I am a huge fan of Starling vs Monzo. Since then, it has been burning through cash, taken a hit on customer card take up, furloughed hundreds of employees and closed its Las Vegas office along with 165 US jobs. By entering your email you agree to Sifted’s, Europe’s fastest growing startups with female founders, Future Proof: Corporate Innovation Newsletter, Sifted Reports: The Future of On-Demand Food Delivery. Revolut vs Starling vs Monzo vs Any other similar ones? One positive for Monzo is its revenues are rising faster than costs. But you don’t hear too much about their banking as a service revenue stream, which results in them selling payment services to other fintechs,” he added. In contrast, Revolut’s cost-efficiency actually dropped. The UK’s top three digital banking apps have all now released their financial results for 2019. It’s been a tough year for the fintechs, to say the least. Revolut’s premium service also offers a small inflow (£16.8m in 2018), joining N26 in charging select users for certain features. Hey, I do have a transferwise borderless account. He also estimates that Revolut squeezed out $5m–$10m in profit from their crypto-trading. Which is obviously a massive perk if you are worried about paying high monthly fees with Monzo or Revolut. Monzo and Starling both offer the MasterCard rate, and Starling charges a commission of around £ 5. “Nikolai will just fire everyone who costs him money (as usual). I've had no experience with Monzo but my clients have been very happy with Starling Bank. However, Starling’s marketplace model seems to have had disappointing results, bringing in just £72,000 in commission from connecting users to third party apps. Monzo, Revolut, and Starling are all good services that people can find benefit in. © 2020 Sifted EU Ltd. All Rights Reserved. Just did a quick comparison by making 2*EUR purchases at … Starling has the most diversified revenue stream Card transaction fees (known as interchange) still made up an important part of all three business models last year. 20 January 2021. Digital banks also still seem to be grappling with how to seriously monetise current accounts — often dubbed the “low hanging fruit” of banking — and it remains to be seen whether their business models can confidently ride out the coronavirus. Two factors of … Instead, it also collected fees from its 80,000 business accounts, as well as having a handful of banking as a service (BaaS) customers, and from interest fees from lending and holding balances at the central bank. I've heard good reports from clients about Starling Bank opening a business account in 20 minutes via the app. Because the future isn’t where you expected, By Isabel Woodford Monzo customers can open tax-free savings, joint, and teen accounts. Other competitors in the UK space include Monese, Revolut, N26 and bunq. “It isn’t surprising that all eyes are on this trio given that they are three of the UK’s fastest growing companies and that fintech is one the true success stories of the UK economy over the last three years,” commented chartered accountant and fintech specialist Nick Levine. Metro Bank has a physical branch network while Revolut, Starling and Tide are online-only. To put it another way, for every £1 spent in 2019, Monzo generated 37p; up from 28p in 2018. The Battle of the Travel Debit Cards: Revolut vs. Monzo vs. Starling vs. N26 vs. Curve. As per the data from Sensor Tower, Revolut’s app was downloaded 5.8 million times last year compared to Monzo’s 2.4 million times and Starling Bank’s 1.3 million … Losses have continued since then, despite revenues increasing 180% to £162.7m (£58.2m in 2018) and its customer base jumping from 3.5m to 10m. Like Monzo and Starling, Revolut earns most of its revenue through a process called interchange, in which it takes 0.2 percent of each transaction fee. Overdraft. Monzo have set themselves up to be capable of handing all your banking needs, and as a UK only provider, are squarely aiming themselves at being a replacement for your current … Have an idea for an opinion piece for Sifted? 4. A matter of taste. Moreover, in Revolut’s case, the direct cost of running each account is still larger than the revenue each customer generates — meaning it still has a negative gross margin. Starling is the only one that pays an interest on current account balances. A recent letter from CEO Anne Boden detailed the digital bank’s growth during 2020, with deposits tripling to £3bn, retail accounts increasing from 926,000 to 1.25m and small business and sole trader accounts more than doubling to 200,000. Speaking on the Rebank podcast, he said: “£160m in revenue… that number feels quite large and it does feel to some extent like a victory of building a large scalable business.”, He added: “There is definitely a big performance difference that we’re seeing between Monzo and Revolut, with Revolut pulling away quite significantly, £100m in revenue difference on the same burn number. “Rubinstein concludes that Starling and Monzo would “have been better off not lending a… Read more ». Which is better? Fintech; 15 May 2019; Monzo vs Starling, Revolut and … Unlike Revolut though, Starling and Monzo both offer interest with their current accounts for savers although neither is j… Monzo is a genuine contender for your regular bank. 07 August 2020 12. To add salt to the wound, Monzo co-founder Tom Blomfield resigned as director weeks after stepping down as CEO. Are a joke getting an account open Bank has a different demographic, our customers tend to more... 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