Here it's 'transfer before 2pm and we'll send it the same _working_ day!!' And that's once you've made your appointment a week out to open an account, and maybe received everything after a few weeks (if they like you that is)...
I got the impression that N26 was mainly to challenge the latter way of working. I didn't understand what their offer was even for a free account that was better than even a 'legacy' bank in the UK (and I'm not sure they even support direct debit - which would have made it useless for any super-cheap energy/phone etc deals).
In all - yes Brexit sucks, yes they may have stayed in the UK without it (although I wouldn't have expected them to introduce anything new), but I don't think they can blame any lack of success in the UK on it.
I moved from the UK to France in 2018 (in part due to Brexit but that is a longer story) and dear god the banking systems here are utter shit.
I am with HSBC and I can't even change the PIN on my debit card! Hell I couldn't even get my card and cheque book (yes they still use cheques here!) delivered to my address as it was a temporary one so I had to collect it from my branch in person.
If I buy something on my card it takes at least three days before it is listed in the HSBC mobile app or web site.
I generally use cash so it isn't a huge issue for me (check my post history for some explanation on why I mostly use cash) but god is banking frustrating here.
The only positive is that I do have an actual account manager (as in the same person) who I always deal with and he is excellent at sorting my problem. I have to say I do like that consistent human content. Obviously if it is an emergency I use their emergency line (lost card, etc) but for general inquiries that don't require instant action my account manager is my go to.
(thank you for bringing this up I feel I needed this quick rant!)
That's actually the case for my HSBC UK account too. It's impossible to know accurately what the balance of it really is at any time too; both the real balance and the available balance fluctuate wildly with no obvious relation to the transactions, which are delayed by a variable 1-3 days (presumably depending on the type of transaction). They seem to be about ten years behind all the startup banks.
Instant update was the killer feature that swung me to Starling. Well, that and Natwest calling some random guy (who later found me to tell me what happened) for a sales call, only to give him the transaction data for my last five transactions....!
(obFD: no pecuniary interest, just a happy customer)
The "plus" that you mention, having a dedicated account guru can swing both ways: mine left my local branch for another branch 10km away, and I would not perform any significant operation without their presence.. which was no longer in the branch.
Boursorama or N26.
I use Boursorama Bank in France and they're pretty good. Setting up the a/c and transferring over from HSBC FR was relatively painless, though they dropped a few of the direct debit mandates that I had to recreate manually. I think the account is free as long as you actually use it actively.
The best way to do this in France seems to be to keep a "legacy" bank just for handling savings without a current account (that way you don't pay for current account, card etc.), and use one of the free challenger banks for current account, direct debits etc.
On another note, I had my ING Luxembourg account (6 figures on deposit) closed by them because, in their own words over the telephone, "I wasn't buying any of their products". They'd call me every few months trying to persuade me to invest in high charge, managed investment products, which I always declined. I explained that I was keeping the money on deposit to pay for my dad's Alzheimer care, but they just sent me a registered letter telling me to take my business elsewhere. I'm sure this breached some banking regulation, but I hadn't the energy to fight it.
Of course! Doing manual pickups with proper ID checks avoids a lot of problems.
My bank will only send stuff to my 'official' address that I have registered with the tax authorities. If I want a OTP-dongle or debit card in some other way, I can pick them up in a branch of my choosing.
I see this as being safe, not as being inflexible or old-fashioned.
I fully understand their need to protect against mail interception and fraud but I think there are better solutions than getting me to go all the way into the centre (about half an hour of my time each way on public transport) to pick up a cheque book is a little extreme.
Funny thing with the OTP generator. They posted that to us! FFS you can't make it up!
Needless to say, they are not the most efficient and are even less prone for innovation.
[0] https://de.statista.com/statistik/daten/studie/38041/umfrage...
Sparkassen failed at numerous attempts to come up with an online payment system that gets any traction and it took considerably longer for them to adopt apple pay.
I think it's also not good to paint commercial banks as one entity: There are old ones, large ones, cheap ones, upper-classy ones, spin-offs and startups. Sparkassen and co-ops are seldomly a startup e.g.. So depending on their clients and considering that SCT in DE has still low adoption amongst clients compared to direct debit mandates, a commercial bank or a startup may very rightfully choose to de-prioritize SCT adoption.
Of course they do. That's the normal, slow money transfer, aka "SEPA Credit Transfer". I suppose you mean SCT Inst?
Even of the bigger retail banks, Consors and ING do not offer SCT Inst.
> And most of them for free while most co-op/sparkassen charge a fee (some of them even for receiving an instant payment which is rediculous).
While it is included at Deutsche Bank proper, both Norisbank and Postbank charge between 0.50 and 1.00 EUR for outgoing SCT Inst, Commerzbank proper charges 1.50 EUR unless you are in one of their premium plans while comdirect (though technically not yet fully part of Commerzbank) is free, Hypovereinsbank is free for all non-business accounts except the cheapest ones, where it's 0.50 EUR.
So ... erm, no, not even close to "most of them for free"?
Also, on the other hand, there are co-op banks that offer free accounts with free SCT Inst nationally.
But who is charging for receiving SCT Inst payments? I hadn't heard of that before, that's indeed beyond ridiculous!
> Sparkassen failed at numerous attempts to come up with an online payment system that gets any traction and it took considerably longer for them to adopt apple pay.
And yet, they (all) implement SCT Inst!?
I think the main problem is that both co-ops and Sparkassen are very decentralized, you're looking at literally thousands of tiny and not-so-tiny-but-hardly-big banks that are all completely independant. That makes innovation very slow - of course they have pooled resources to have a somewhat centralized IT infrastructure, but the power to decide on innovations is ultimately still with the thousands of member banks.
The carmakers in Germany shut down various attempts to incentivize electronic cars and inquiries in their criminal behavior in the cheating scandals.
I think there is a fine line between lobbying and being downright criminal. I think most companies have actually crossed the line.
Deutsche Bahn after privatization let the train tracks in Hamburg rot for a long time. Now that they've passed the safety threshold they decided not to renew the tracks but instead move the train station somewhere else.
I've been involved in a government construction project and the way the contracts are handed out are on the surface to the highest bidder, but it's hard to call it anything but corrupt.
Lobbying is one thing, but threatening consultants and employees with repercussions and lawsuits for wanting to inform people about lies that led to these contracts is in fact criminal. I had a good lawyer, but nothing happened to the leadership on either side and nothing probably ever will.
Would you please elaborate? I have had quite a good experience with those banks.
The banking startups are collecting account holder information so they can turn around and upsell you on credit cards and other products.
But it gets better ...
There is no such thing as a startup bank in the US because the government doesn't grant bank charters anymore. All those new companies aren't banks at all. They piggyback on top of an existing bank or the ACH network.
That's why none of them say FDIC-approved, since they can't be part of FDIC.
Perhaps you meant something else?
[0]: https://www.fdic.gov/regulations/laws/bankdecisions/depins/i...
Is this true? Why is this the case? How long has it been like this?
Zelle: effectively instant, requires both banks to be on the network, free. Relatively new and many people who could use it don’t.
ACH: a few days, effectively ubiquitous, very small underlying charge infrequently marked up to ~$3 by the bank.
Wire transfers: not quite instant but close during banking hours, effectively ubiquitous by institution but often a pain for retail users to access due to risk profile, underlying cost is about $5 and often marked up to $15~$20.
The UX of the P2P payment apps is much, much better than any of the above, and would be what I’d reach for for a transfer in the $X0 range contingent on my counterparty being likely to use apps.
Banks in Europe: There might be a fee in some cases but I don't remember paying one (or it's <$5). Rent or similars are just recurring SEPA payments (it's a push - not a direct debt)
But can people (not business) initiate ACH transactions?
Yes. I used to do it to move money between checking accounts at different institutions. I don't think I've ever had an account that charged for ACH transfers. Meanwhile Zelle isn't supported by exactly one financial institution I use (but not one I use for banking).
https://www.mybanktracker.com/checking/faq/ach-transfer-fees...
As a side, in sites such as this (HN), especially when comparing things to the US there is defintitely a tendancy to make sweeping statements such as 'in the EU $thing is [blah]...' but actually there are huge differences across the continent, which I think is actually the news story here.
there are a couple tiers of paid wire transfers, but still no guarantees that you will have liquid settled cash in the same business day.
the mere concept of the SEPA system in the EU is pretty nice
Online banking is also _the_ identity service for logging into official and semi official systems here (unless you’re a nerd and want to hook up a smart card reader and your [optional] ID card - which I totally am) and I guess there’s a heap of compliance to deal with to enter this space, which would further limit entry to the market.
Weird. Transfers were instant when I moved over there almost 20 years ago, and you could already do them online if you wished (there was a system of codes on a paper or a card, on top of login+password). And that was in very traditional banks like the Postal Bank (Postipankki/Leonia/Sampo: it changed name at least 3 times during my stay). I cannot imagine it can have gone worse during the last 10 years.
Opening an account was no problem and quasi-immediate. The only annoying thing is that as a foreigner I had to stay 2 years before getting a regular credit card (I didn't care about the 'credit', since in my home country we don't use credit cards but only debit cards, but for 2 years I was only allowed the Visa Electron which was not well accepted or perhaps not accepted at all abroad, so it was limited even as a debit card).
In your case, when you say slow, how slow has it become?
Don't know mate. I don't know the UK banking system so well. But if I take HK experience with HSBC and SC and Newcomers in the UK like Revolut then I doubt your statement will make any sense.
I think Germany has instant transfers for a fee but I am not sure. There was never a need for it.
Czech has instant transfers already? Great. The CZ Bank I know charges 6 Euro per incomming EU Euro transaction.
I've lived in the UK and another European country, and if I didn't recognize brands like "HSBC" and "Barclays" I would have thought they were failed non serious players.
The UK is quite literally decades behind some other countries, in banking.
In what ways?
For a start.
So I can see how their model wouldn't be very good, or very disruptive, in places with more consumer-friendly banking options.
Italy is the same way and it is awful. We signed up for our bank account at one specific branch of a bank in Padova, Italy, and it's impossible to do much besides withdraw some cash at other branches. It's so dumb.
I've encountered the same thing in Germany, when I log in I use the branch number of where we opened the account? Why? Who gives a shit about that? I certainly don't. But the bank does, for some unfathomable reason.
For each way German banks are better than American ones, it seems like there's a way in which they're backwards or overly conservative.
Side-story: southern Italians who relocated to the industrialising North during the ‘Italian Economic Miracle’ of the 1950s to 1970s referred to the process as ‘emigrating’. Until it was looked down upon by more modern sensitivities, they were referred to as ‘immigrants’, and their offspring referred to as first- and second-generation immigrants.
It really is a rather static society, though now there’s a significant and constant flow of young graduates from the hideously unemployment-afflicted South towards the North, or abroad since the Great Stagnation set in about fifteen years ago.
In the US and Canada, you’ll have a home branch too. Usually it doesn’t come up in anything day-to-day.
State laws for one thing may apply to accounts opened in a particular state.
But if a bank merges or gets acquired, or fails, and some branches get sold/divested, and not necessarily to one party.
One could find themselves a customer of a bank that is no longer local to them.
Here’s a merger that had a divesture:
https://www.bauerfinancial.com/2019/12/09/its-truist-theres-...
I ask because in the UK, each bank branch has a six-digit "sort code", which others will need to know in addition to your account number to transfer you money. However, you can open an account at a branch and never step foot in that branch again afterwards, only ever using other branches. Account numbers are only unique for the same sort code.
This is at Deutsche Bank, by the way, not some podunk obscure bank.
Of course, if you do move and you want to apply for a new credit card, they will mail the card and paper work to any of the locations, so it's not that bad. And all of the banks in the group have an unified online banking system, no branch numbers needed. However, when I switched between the different banks, I had to get new login details for the online bank, which was kinda sucky.
With home-banking these differences are even more marked, some sites have "reasonable" possibilities offered to the customer, some other have next to none (besides checking your account) some have relatively simple workflows some other are so stupidly complex that you give up.
More or less all of them (the sites) have an inane amount of meaningless dashboard/graphics, and very poor tools (as an example to download some data).
However, when it comes to "serious" matters things are seemingly "random" in the way they change from bank to bank, personal anecdata, a few years ago when an old relative died, to access the accounts it took the heirs (with exactly the SAME documentation):
Bank #1: 3 days <- exceptionally fast
Bank #2: 10 days <- I would say "appropriate" or "logical"
Bank #3: 7 months (or 210 days) <- completely "crazy"
And let's not even get into keeping an account in another currency. My bank apparently never had to do anything of the sorts, and after digging for information they told me it would cost about 400€ per year just keep the account open.
As riffraff said, Fineco is one of the very few banks (maybe the only one) that gives the possibility to have foreign currency accounts (linked to a "main" Euro account) at a "reasonable" cost, which is a good thing to have if you deal a lot with the US (both with receiving US dollars and spending in US dollars), but that is not needed for "normal" activities.
The "conto in divisa estera" (that quite a few banks have) is basically aimed to business entities (like firms doing import/export) and is usually rather expensive, or - to be more accurate - has very high fixed costs.
The alternative in the case of someone receiving US dollars may be some form of accounts with credit/debit cards issuers, but - again generally speaking - they - besides offering less possibilities (and not being "properly" a bank) tend to have low fixed costs but higher commissions/fees on single operations.
Investing from the banks themselves it's also possible but it involves higher fees. Using IB has the disadvantage that I have to do the taxes myself.
Ow, come on, you know the saying:
[Italian]
Si dice il peccato e non il peccatore.
[/Italian]
More seriously, as said that is single point anecdata, it is perfectly possible that today a similar test would give completely different results.
And I do understand that things vary. One time, for instance, I even had a package arrive quickly through Poste Italiane.
Err. C&P was universal by 2006ish from memory, but many venues just didn't accept anything other than cash at all. I suspect you are misremembering.
Also from memory, I'd guess 10-12 years as the point when chip&pin was required for _every_ card transaction. Now of course we have moved on to also have contactless.
No one would know what I was talking about unless I referred to it as the "click-clack" machine.
Now I can only think of them using that name.
A former employer uses one for selling excess stock to staff.
I found it very odd when I was in Germany that this wasn't the case, Visa/Mastercard were entirely considered credit cards, and debit cards used some entirely different system. I couldn't use my debit card to pay for a Berlin subway ticket, as the machines only took German bank cards.
Visa Electron was in a different category with Switch Solo. I think they tended to be issued on accounts with no overdraft facility. (I had a Solo card as a teenager and it was only accepted at a handful of places.)
I remember being really annoyed when my
Maestro is pretty common, but there's also something called EC-card or similar. However, the Berlin subway machines now take visa/mc too.
Traditional French banks have a penchant for issuing debit cards with monthly fees and low daily, weekly (!) and monthly (!) limits.
I had a HSBC business account where I had to pay 45EU a month to lift the 300EU per week limitation.
Likewise, French banks refuse to issue chargebacks. The last time I tried, I was told to lodge a police complaint for theft to take the unknown entity who hit my card to .. court ..?
N26 etc have been a breath of fresh air in France.
And most online banks (e.g., Boursorama, Hello Bank, Fortuneo, etc) do not charge you a monthly fee for a card.
In the UK you can write “direct debit” in the minimum payment amount on your credit card application and it will be linked to another account to be payed off in full every month. This will avoid interest charges.
This arrangement allows me to run my credit card accounts for free with no monthly charges.
For us it was just a bank that lacked features and had charges, without a memorable brand.
You just have to choose your bank carefully. Boursorama or Fortuneo are typical decent examples.
https://www.which.co.uk/money/banking/bank-accounts/best-and...
Top of the list (as it often has been for decades) is First Direct. This is a challenger bank in its own way - it was launched in 1989 to pioneer telephone banking, a disruptive technology at the time! It now has phone and internet banking, but still has no physical branches.
Monzo and Starling, the proper challenger banks, are also rated very highly, taking the second and third spots.
Behind them are some somewhat unconventional banks:
Nationwide is a building society rather than a bank; functionally it's a bank, but it's owned by its customers, rather than by investors. Dates to the 19th century, has many branches, very boring really. My mum banks with them, and she doesn't complain.
Marks & Spencer is an upmarket department store (i swear by their lambswool socks!) which branched out into banking a while ago.
Metro Bank is a perfectly normal high street bank, with branches and so on, but it was founded in 2010. Apparently the last time a new bank was founded before that was 150 years earlier.
The Co-operative Bank is, as the name suggests, a co-operative. It's a bit like a building society, but not. I bank with them. Their website is terrible and their phone customer service has been slashed (although when you do get through to someone, they're great).
Only then do you get to Barclays, which is a classic high street bank - founded in the 17th century, branches in every town, full service, investment banking arm, rigs LIBOR, etc.
It's no longer a co-op and its relationship with the Co-Operative Group will end later this year.
[any fintech enthusiasts trying to think of a challenger bank niche the UK hasn't already got multiple heavily-marketed competing alternatives in might like to go down the ethics route...]
First Direct and Marks and Spencer are brands of HSBC. First Direct is independent enough that you get a very different service from them compared to vanilla HSBC.
As others have said, Co-op is owned by private equity now. When they were a true co-op, you could forgive them the odd bit of sloppy service but there's no excuse now.
If I were coming to the UK for the first time, I'd see if a local bank in my country (usually it's HSBC or Santander) could offer to help me set up when a UK account with their local subsidiary. KYC, credit checks, etc can make opening an account difficult when you're new to the country.
(Note: I don't use either)
Monzo doesn't ask for proof of address, while other banks will need something like a utility bill. As a newcomer to the UK, one is pretty much obliged to open a bank account with Monzo.
My understanding is that UK KYC basically don't specify exactly how to validate an individual's identity, only that the bank should do that (https://www.gov.uk/government/publications/identity-proofing...). It does suggest that a person's identity is "often someone’s name, date of birth and address", but it doesn't seem to mandate that.
I believe the requirement for banks to hold addresses is actually an AML requirement, and this only comes into effect for larger or riskier transactions.
In a sense, the requirement to have a "provable address" just to open a basic bank account becomes quite problematic when you consider there are people who don't have fixed addresses. Whats worse, you discover that most of the ways in which you can get a fixed address require you to have a bank account (e.g. renting a place to live). It's an entirely unnecessary chicken-and-egg scenario caused by the insistence of the older banks on collecting proof of address, which they didn't technically need to do.
And you're also correct in terms of AML - once a person crosses over a certain threshold or raises and risk alarms, they'll be required run further AML checks. Eg. if you were to signup to Monzo and then put 50 grand in there from a foreign account.
What Monzo has to do since they are new, is keep a squeaky clean record with the authorities. This is why Monzo usually blocks or even bans anyone that buys Cryptocurrency eg: https://www.reddit.com/r/monzo/comments/avdw8o/notice_regard...
Source: I work in Crypto
Other banks vary a lot in what paper they accept, but they always want some papers.
https://monzo.com/blog/technology
Also check out all the awesome tech meetups they host at their new office. There's a very strong and small open source 'cloud' tech community in London where everyone knows everyone. Try hard to meet some people and before you know it you'll have a new group of friends.
I was a huge Monzo fan, converted dozens of friends to it and was one of the first ones to get their beta current account (which I immediately started using as my main and only account despite it being in beta).
Nowadays however they seem to have trouble making profit, but instead of focusing on their existing customers they pour money into more marketing even though they can’t actually support all of them and now customer service response times are measured in days. They feel like a bullshit social media company with no real (aka profitable where people are happy to pay for it) product and are just trying to inflate their customer numbers no matter what.
Now I bank with Starling. They aren’t as “nice” as Monzo used to be but are definitely a lot better than the current Monzo both in terms of support and UI (Monzo redesigned their UI and it’s a shit-show now). They also offer business and Euro accounts if needed.
In addition they have business accounts which don’t have any of the costly features like interest, free cash deposits, etc so they’re profitable for Starling as they profit off the interest (especially relevant for business accounts as they might hold high balances keeping money aside for taxes and VAT) without giving out many costly features like cash deposits (the only overhead there is support and foreign ATM withdrawals).
Domestic ATM withdrawals are a cost for Starling as they have no network of their own; they're not even part of Link.
I'm not sure that the paltry interest they can gain from business deposits will be enough to make those accounts profitable (they just announced another £60m of funding this week).
I'm a relatively happy personal customer of Starling, so I'm not against them, but I do think it's a bit optimistic to say Starling's business accounts are profitable based on no evidence.
1) Sign-up quick and painless (You need a UK address though)
2) Card arrived in a few days
3) Activation just requires tapping it to your phone
Going to have to check out these meetups, sounds like fun.
I've moved the opposite way and have been quite happy with it.
TransferWise is only registered with the Prudential Regulation Authority as an e-money service authorised to provide payment services. You can search the register at https://register.fca.org.uk.
In reality, they appear to hold the funds with Barclays so if TransferWise failed, you'd get the funds back. It's only if Barclays themselves became insolvent that you'd be out of pocket since you wouldn't be covered by the FSCS.
Frankly even in the US I personally wouldn’t bother using credit cards. The management overhead of maintaining one (you have to pay it off on time, have 2 balances to look at, etc) is IMO not worth the money.
https://www.moneysupermarket.com/credit-cards/guide-to-credi...
Unless I can automate this it’s still an extra step I can’t be bothered to do.
They are an "Authorised Electronic Money Institution" like PayPal. If they go bankrupt, you will lose all your money.
https://register.fca.org.uk/ShPo_FirmDetailsPage?id=0010X000...
I'd strongly recommend you open a real banking account.
https://support.monese.com/hc/en-gb/articles/115002002229-Is...
"Unlike banks we do not re-invest customer funds and have to keep all customer money separate to our own company finances. We are required by Regulation to Safeguard all funds received from Monese customers. This guarantees that even in the unlikely event that Monese is no longer in business, all of our customers would receive 100% of their balance back"
The point of the FSCS is that it doesn't matter what happens to your bank. The government will pay you back up to £85k of what you had there.
So while it's not a given that if they go bankrupt you "will" lose all your money, just that you "may" lose all your money. :)
Insolvency events are covered by section 24 of Part 3 of the Electronic Money Regulations 2011.
"24. (1) Subject to paragraph (2), where there is an insolvency event—
(a) the claims of electronic money holders are to be paid from the asset pool in priority to all other creditors; and
(b) until all the claims of electronic money holders have been paid, no right of set-off or security right may be exercised in respect of the asset pool except to the extent that the right of set-off relates to fees and expenses in relation to operating an account held in accordance with regulation 21(2)(a) or (b) or 22(1)(b).
(2) The claims referred to in paragraph (1)(a) shall not be subject to the priority of expenses of an insolvency proceeding except in respect of the costs of distributing the asset pool."
So, these funds would be kept secure from other creditors and paid out as a priority.
https://www.legislation.gov.uk/uksi/2011/99/part/3/crosshead...
According to their site 100% of my funds should be covered since they are required to hold any client funds in a separate account which they cannot use for anything at all.
https://support.monese.com/hc/en-gb/articles/115002002229-Is...
Not sure what the implications are with that vs being a "real bank"
Id also open a second backup account with one of the high street banks Satandares fairly good on rates and Nationwide has a pretty good Cash ISA
Longer term I would go for ii if you want to get into Shares ISA's
I would not store my money with them.
And in particular:
https://www.heise.de/newsticker/meldung/33C3-Schwere-Sicherh...
Banks in general are terrible at IT security here, but N26 seems to be the particularly special completely and utterly incompetent kind of terrible.
What do you feel is the advantage of N26 over older banks?
Banks in Germany normally charge you to get your own money from a machine?!
A bunch of the banks have free withdrawals from all ATMs though. N26 is one of these, though as parent said, that's now limited to 5 per month. Several others are still free without limits.
https://www.theverge.com/2019/3/3/18248826/revolut-workplace...
https://www.wired.co.uk/article/revolut-trade-unions-labour-...
https://www.telegraph.co.uk/technology/2019/02/28/revolut-fa...
Consider Transferwise as an alternative.
Revolut does have the advantage that it lets users maintain balances in multiple currencies at the same time.
This has also been my observation. Multi-currency support is something I would like to see come to Monzo, although I'm not sure what regulatory constraints this would apply; my understanding is that most conventional multi-currency accounts (e.g. CitiGold) actually involve multiple accounts in several countries with the parent international bank guaranteeing free transfers between the individual accounts at market rates.
Edit, I had a quick look at Google play downloads as a benchmark (Not great I know) but looks like you're right. Monzo is 1m~ Revolut is 5m~
> It's worth pointing out that this scheme is not currently in place
This isn't strictly true. By law, electronic money institutions are required to safeguard customer funds. In the event of an insolvency, customer fund claims would be paid out in preference to all other creditor claims and there's various other safeguards to ensure people get their money back.
Specifically, Section 24 of Part 3 of the Electronic Money Regulations 2011 covers this:
-- 24.—(1) Subject to paragraph (2), where there is an insolvency event—
(a) the claims of electronic money holders are to be paid from the asset pool in priority to all other creditors; and
(b) until all the claims of electronic money holders have been paid, no right of set-off or security right may be exercised in respect of the asset pool except to the extent that the right of set-off relates to fees and expenses in relation to operating an account held in accordance with regulation 21(2)(a) or (b) or 22(1)(b).
(2) The claims referred to in paragraph (1)(a) shall not be subject to the priority of expenses of an insolvency proceeding except in respect of the costs of distributing the asset pool.
(3) An electronic money institution must maintain organisational arrangements sufficient to minimise the risk of the loss or diminution of relevant funds or relevant assets through fraud, misuse, negligence or poor administration. --
https://www.legislation.gov.uk/uksi/2011/99/part/3/crosshead...
It doesn't surprise me that more people have used Revolut at some point, but I would still expect that Monzo has more active users.
Edit: This is in the UK, I understand Monzo isn't quite as well known elsewhere.
In Brazil for same bank transfers I'd get an SMS in my phone at the same time as the sender got the confirmation that the transfer went through on their phone. Transfers between banks would typically clear in 2 hours or less. With cash withdrawals I got an SMS in my phone before the ATM was finished counting the notes.
Here in Germany I have to reverse engineer what the entries on my transaction history were from vague hints in the business name, because they take days to show up in my account. Cash withdrawals from an ATM run by my own bank sometimes take 5 days to show up in my transaction history. I regularly do SEPA transfers to Portugal and it arrives at the end of the next business day, at the earliest. SEPA transfers in Germany sometimes clear same day, after several hours, but usually some point in the next day.
This is not “instant”, but 1 hour is much better than 1 day.
List of banks with SEPA ICT: https://www.europeanpaymentscouncil.eu/sites/default/files/p...
My bank charges 0.50€ per ICT transfer.
My impression is that banking is massively overpriced in Germany. I understand it's not trivial and "I can build that on a weekend", but I don't see the need to spend ~10 euros on the average checking account that has two dozens actions a month. The pricing is also extremely stable despite all the technological changes, which seems to suggest that as well - if you go by prices, running it all completely digital is as expensive as having somebody manually read a paper slip, punch in the numbers, stamp the paper and file it away.
That's not really true. While there is a huge number of banks, most of them are either co-op banks (Raiffeisen- and Volksbanken) or Sparkassen, and while they are all separate legal entities, all the banks from either of those groups run on their respective common infrastructure (Ficudia & GAD IT and Finanz Informatik).
Funny that in countries like Chile transfers are free and instant.
So ... if this is instant, it leaves a lot to be desired still. It's not as fast as sending someone cash over a messaging app, say. And it doesn't work well with international networks, and there are expensive fees for cancelling a transaction, and banks can waive the fees, but if you're on a free plan chances are you either don't have auto deposit, or you'll have to pay for the Interac E-Transfer fee. They commonly set it at $1-1.50 per send, when internally, transferring money between banks (such as with Canadian EFT) is barely a penny. Of course, an EFT transfer generally takes 2 days, but I can't imagine it has to take that long, you'd just have to do inter-bank settlement more frequently.
You can still send a payment from HSBC, for free, instantly, to any other UK bank account. You can also just about do most things in their online banking. This more than can be said for some other parts of Europe.
My wife is with HSBC and the iOS app doubles as both a banking interface, and the authorisation code response generator.
When she's in a web browser and needs to generate a code for the HSBC website (eg to add a new payee), she has to log out of the phone app to be able to get to the response code UI.
It blows my mind every time she does it. How on earth did they come up with that UX. It's like they're actively trying to be awful.
Apologies to anyone reading this who worked on this at HSBC, but yikes!
I suspect the flow you noticed actually helps enforce that - if they gave you a code to let you use on the website, they'd have to log you out of the app anyway.
However, over the past few years they've really improved. The website is now consistent across all tabs (at least that I use for personal banking) and the app is simplified with most functionality needed for personal use in there.
On the personal side, I've always found the people at branches of HSBC (regardless of where you go) to be courteous and professional relative to the few others banks I have accounts with. I'm not in the UK, so perhaps things are different there, but in North America I've found them to be a slight step above average (insofar as you can be for retail banking --- it's all relative!).
nationwide and natwest have much better apps and websites
I still ditched them for Monzo though, mostly because natwest's anti-fraud system was reliably triggered by my mostly-online transactions, 3-4 times a year.
Actually pulled the plug on my UK ltd. pre-Brexit due to Bankxit...
N26 wants you to use their cards (or Apple Pay), and to be honest I have not been withdrawing any money from an ATM for 5+ months. I’m from Hannover, Germany.
it was around this point that DKB also realised they could do this and stopped allowing atm withdrawals less than 50 eur
Then came all those new app-based banks like N26, and instead of implementing FinTS, they decided to just offer their proprietary app, and that's it. Some later implemented some kind of proprietary API as an alternative to FinTS (maybe FinTS wasn't hipster enough, because it's a bit old-school, XML-based instead of another REST-style HTTP thing with JSON), but those always lacked the core feature of FinTS, which is broad support of the same standard by many banks.
And now we're getting PSD2, which in some ways wants to establish broad (mandated by law) support over many banks again, but not by specifying an API designed to be used by customers, but by businesses only. Hence what we in Germany were able to do as customers for a long time - magically access dozens of accounts at different banks from a single application and without ANY middlemen involved - is now gradually becoming an ability that only corporations will have, because as a private individual it's practically impossible to meet the requirements to get access to PSD2 APIs (even though they basically do the same as FinTS already did for decades), and banks are already toying around with the idea of shutting down their FinTS API gateways somewhere in the future, because that other protocol is legally mandated and FinTS isn't.
Based on my experience with HSBC and SC (from HK) I doubt that they are really outstanding. Revolut? Well, you can buy crypto. But the App is terrible.
Most critique here is basically about Apps not being good in EU/Germany. This may be the case but honestly I have zero interest in doing Banking via an app, except for transaction code generation (actually this was terrible at HSBC and SC). It is much more convenient to do this on my computer. If I want to use an app, it should be like WeChat or Alipay. But a banking App? I personally have no need for this.
Last month, I paid a bill through SEPA money transfer from a Volksbank account and it offered a checkbox for "instant transfer" (don't remember the exact wording). I was quite surprised to see a charge of 0,21 € for that in my account statement last week.
Asbestos in food? Attractive new opportunities for US pharma to sell opioids? Houses no longer need windows? EULAs on jeans, making you pay day?
Europe is very comfortable watching it from the sidelines. I'd say it's an interesting experiment, but unfortunately the last two years have shown it's rather boring and everything turns out exactly as anyone with even basic grasp on reality has said it would.
Things like blatant crime should still be regulated, but creating an easier regulatory environment for businesses in the UK is absolutely a given next step.
He will be focused on regulatory alignment with the US as he desperately needs to sign a US-UK FTA. And yes the US has a lot less regulations than the EU e.g. chlorinated chicken but in other areas it is not less but just different.
UK businesses are going to find the next decade extremely painful as they deal with trying to support US and EU regulations whilst also dealing with customs controls at the border. So all of the pain with none of the benefits.
This seems over-board.
Firstly, like in every country, most UK businesses don't sell abroad at all. So no, most businesses aren't going to find the next decade any different to the previous.
Secondly, businesses that wanted to sell into both EU and US markets already had two sets of regulations to deal with and would have done no matter what. That is no different to what it was before either.
Finally, businesses have been dealing with customs controls at the border for as long as international business has existed. That's hardly a big deal either.
He will be focused on regulatory alignment with the US as he desperately needs to sign a US-UK FTA.
No he doesn't. Plenty of countries around the world have perfectly fine economies and growth despite having no FTA in place with either the USA nor EU. It's nice to have but not essential for anything.
Now, "regulatory alignment" doesn't have to mean adopting the exact same rules as the USA. That's the EU's approach but it's often not the best approach. A simpler way to gain the same benefits in most cases is just regulatory recognition. In cases where there's no actual fundamental disagreement between systems, but actually unifying them is unwanted for reasons of political independence (i.e. retaining the ability to fundamentally disagree in future) both countries can simply choose to accept products that comply with each other's sets of laws.
The EU freaks out about this approach because the goal of the EU is not to make business easier but to unify Europe into a single country, and abolish the existing ones. Obviously to do that mutual recognition of standards is useless. Only obedience to a centrally controlled set of regulations will do the job. A lot of people in the UK have spent so many years under the thumb of this system that they find it hard to conceive of any other way.
One third do. As for the rest, they may not trade abroad directly, but their suppliers and customers certainly will.
Yes, I know it isn’t even coherent to expect “the EU” to grant the UK better access to the domestic markets of 27 nations than those nations give to each other, but when I raised this the response was either “that proves we should leave” or “that’s just project fear”, often preceded or followed with some comment about BMW, champagne, or the Spanish tourist industry.
Point is, they will renege on their promises on this topic no matter what, so while your argument would normally be sensible, nobody can rely on that this time.
The most that can be said is that the Tories (and the harder Brexiteers) have a significant majority, which makes moves towards deregulation more likely - that doesn't mean it's the right thing to do, or will happen without considerable push-back from people who are not quite so ideological (or who are, but of the opposite persuasion).
considerable push-back from people who benefit from the current regulatory structure
considerable push-back from people who are not quite so ideological (or who are, but of the opposite persuasion)
So no bean-counting nonsense here, just the benefits of standardization. Nobody would be angry at the EU for standardizing screw sizes, for example.
"It must be made clear that the demand for these standards came from the industry itself"
US is demanding regulatory alignment in agriculture and food safety as a condition of the FTA for example. And the US has significantly higher rates of food borne illnesses compared to the UK due to these weaker regulations:
>"One in six people in the US get food poisoning each year and one in 66 people in the UK get food poisoning each year."
Saying that while correct, the two specific studies use different methodology and should not be used together in a sentence.
I think there was real fear that Brexit was required to avoid a similar situation developing in the EU.
At least that was my understanding of today.
EU budget always had a kind of political and strategical value attached to it — e.g. to protect agriculture, which is sound strategically (to be able to feed yourself in isolation if it comes to that), but the deeper symbol is that Europe is very afraid of famine. In the 1940s, it all began with cooperation around coal, energy. The EU, at least originally, is built to ensure individual countries can't F with the really important stuff (between each other, nor shoot themselves in the foot).
Evidently, the mission has been met with some difficulties.
Of note, England negotiated a rebate before joining. So, it’s a demonstrated issue for them.
Customs controls need and are going to be imposed whenever there is no official agreement in place (and overseen by the ECJ) for regulatory alignment. And the ECJ oversight is a hard red-line for the UK.
Which means that it isn't a sliding scale. It's black or white. Either you fully align with oversight or you don't. And if you don't then you are hit with the full suite of custom controls.
There are 2 reasons.
The first is because ultimately you rely on the state's monopoly on legitimate violence to enforce those rules. If you want protection from fraud or simply outright theft, you need to rely on the mechanism of the state. And the state might determine that a contract or transaction, though voluntarily entered into by both parties, is still unenforceable because it unconscionable or harms the general welfare.
The other reason is the experience of the Great Depression, where for instance over 5000 banks failed in the US prior to the creation of deposit insurance. People making prudent decisions in good faith can still collectively make a system unstable. And if you lose you savings that's a problem for you, but it a few million people lose their savings that becomes a problem for society.
Obviously that is a simplification, but it shows why letting each customer choose for themselves how unregulated their bank should be is recipe for disaster.
A common set of rules across all banks ensures that they'll continue to work with one another.
You are absolutely right. Banking here in Germany is ridiculously slow. Transferring money between banks often takes 1-2 working days, so if you're sending money on a Friday evening, the transfer usually takes until Monday to be finished (although this depends a bit on the bank). Some banks have instant transfers as an option, but they usually cost extra and don't work for every bank. This is so annoying, that my friends and I always end up paying each other with PayPal since it is by far the easiest and most convenient way.
Another reasons N26 I think makes N26 is so popular is, that they are one of the few banks with actually good apps. At my bank, I'd have to pay (!) to receive notifications when there is a transfer from or to my bank account.
Superior support when I need it on demand, the tech and apps seems solid, intuitive analysis and usage, the ability to have multiple sub-accounts and the ability to create rules to route money between them.
Natwest in particular seem stuck in the past, I cannot count the amount of times I've opted in for digital communication only and always continued to get letters to which I can never get through to support.
And if NatWest were the only competition in this market, I’m sure N26 would have done fine. Monzo, Starling and Revolut all have far superior products and market offerings however.
Do you have more details on that? FCA only lists a e-money license.
It wasn't even attached to the account, I had to transfer money to it (so, a prepaid card) and couldn't even see the remaining balance (I really tried).
Terrible experience, but they were the only option for me at the time.
Had that very same experience with Sparkasse, Postbank and my Amazon credit card.
Have you banked in both the UK and Germany?
I have, and it was no contest, UK was horrible, expensive, slow and unresponsive.
Which parts were slow and expensive?
The referendum was almost 4 years ago and only last year they were talking about expanding in the UK. Some people might have been in denial but considering the political force of a referendum result and the glaring absence of any political alternative for years now, any other Brexit outcome was a fantasy and remaining in the single market never realistic.
As you say the reality is that they are not doing very well in the UK and they are also investing in the US, and so made a commercial decision not to invest further in the UK.
Edit: As far as I know a full banking licence is not compulsory to offer purely electronic current accounts in the UK. Revolut only got a banking licence in 2018, and it is from Lithuania, so they are also at risk of losing it for their operation in the UK. Just saying...
Referendum was 4 years ago. But only until the recent election i.e. Dec 2019 did Johnson have the numbers in Parliament to actually "get Brexit done". And this week for the first time in 4 years, UK government is formerly advising businesses that there will be a hard Brexit:
https://www.gov.uk/government/news/government-confirms-plans...
Any business in this sector had prepared over a year ago for a worst case scenario. New business entities etc have been long up and running
Any business so inclined can also use this https://www.bankofengland.co.uk/eu-withdrawal/temporary-perm...
If you believe this nonsense you have a problem
The point remains that this isn't the key reason behind their decision. I guess it's easier to blame Brexit than to explain to your customers that you're closing their accounts because of good old business.
They launched in the UK after the Brexit referendum and they don't even need that bank licence to offer electronic current accounts in the UK (Revolut did that for 3 years and their current bank licence is also an EU one so may also become useless in the UK).
This will be true of many regulated industries if regulations diverge, and most industries with a supply chain across Europe too, so expect to see a lot of factory closures in the coming years, along with missed opportunities for new investment (for example Brexit was a significant factor in Tesla avoiding the UK, and financial services like EU clearing will probably gradually move toward the centre of gravity too).
You are in denial about the financial impact Brexit will have.
https://www.theguardian.com/technology/2019/nov/13/tesla-cit...
https://www.reuters.com/article/us-britain-eu-clearing-exclu...
https://www.theguardian.com/business/2019/feb/03/nissan-conf...
History will probably repeat itself: the current, or next Government will reduce regulation to encourage businesses to stay or locate in London. Banks will exploit it somehow. Cue next financial crisis.
With an EU-wide banking license, N26 can operate in any territory it chooses to, for relatively little marginal overhead. Once they need a completely separate banking license for the UK, it changes the model significantly and would need them to be significantly more successful to justify continuing operations here.
It is all brexit related, why can’t you see that? Why else would they suddenly pack up shop?
Unfortunately This is just the first to come.
Can you explain a bit more what you mean by this? Tracking exactly in which sense?
So lets say you have a bank account in the United Kingdom. Now for whatever reason, I am now living in Austria, the bank can ring up my information without additional paperwork.
Now that the UK is in the process of transition, this isn't possible unless a court order is presented yadda yadda. It would be a threat for like N26 to have me as a client but unable to look in to my spending habits. If I had a bank account with loans enabled, I could take a loan and just disappear.
Under the European Union (Withdrawal Agreement) Act 2020 all existing EU law has been incorporated into our domestic legislation so the EU mony laundering scheme (assuming it is some form of legislation by the EU) still applies even though we are no longer an EU Member State.
However, it can be repealed after the transition period ends (1st January 2021) which might well happen depending on the priorities of the Government at that time.
By all reports, N26 was not doing so well in the UK. Other established challenger banks such as Monzo and Starling are taking up the mindshare of people wanting to move from an incumbent bank, leaving little room for N26.
It may be possible that with just 200-250k current accounts in the UK, it wasn't deemed worthwhile to go through the effort of gaining a UK banking license to keep their UK expansion efforts going. The competition is just too hot.
Last year it looked like Brexit might quietly just never happen.
I'm not buying any of this. I'd speculate that N26 was denied a banking licence in order to look after the "British challenger" banks who already operated in the EU with their EU licence. Having been denied the licence makes operating in the UK post Brexit impossible.
I use N26 -- it's free, great app and because it's German all savings up to €100k are guaranteed by German gov.
I don't think that's really addressing the point though: Monzo/Starling/et al. are also all free, have a great app and savings up to £85,000 (€100,000) are guaranteed by the UK government.
The fact that they have an order of magnitude fewer customers in the UK than Monzo, for example, seems like strong evidence of their failure to compete; it seems hard to find a compelling reason to use them, especially when they were so late to the market.
Same applies to all banks in the EU.
>As a result of the implementation period, FSCS expects there will be no changes to the scope of its protection before 31 December 2020 resulting from the UK’s exit from the EU.
https://www.fscs.org.uk/about-us/brexit/
I mean, I guess there's no EU directive forcing the UK to keep doing this, but what's the likelihood that they want to take this away?
They're very successful in Germany where banking is a very slow, difficult, manually run industry (from what I've heard), but in the UK we have generally very good banking infrastructure – payments are normally instant and free, and there's a lot of consumer protection with things like the current account switching service guarantee.
Startups such as Monzo and Starling started in this great infrastructure and now offer relatively compelling products, while the incumbents are getting to grips with modern tech and doing better than many people realise.
N26 on the other hand just didn't have a compelling offering. They charged for most/all of their accounts (explicit charges for accounts in the UK are uncommon), they lacked features, and their marketing was unremarkable compared to the competition.