Why this fintech startup sees an end to branch banking

by Fergal Gallagher
November 23, 2015

In 2010, Brett King wrote, “the death of retail banking is here."

The Australian futurist and author believed current technology meant there was no longer any need for a branch system that didn't meet customer needs. And they weren’t just hollow words from a commentator. The following year King cofounded Moven with Alex Sion, an app which enables banking, just without the bank.

The New York-based company currently employs more than 50 people, recently raised $12 million and is expanding internationally. With Moven, your checking account comes with a MasterCard debit card, which you can use to make purchases or get cash.

So what’s so different? There are no ATM charges, no deposit fees and no overdraft fees. Moven makes its money only from transaction fees, which are charged to both sides.

“You shouldn’t have to pay money to use your own money,” Moven chief customer officer Vincent Bahk (pictured left) said. “Customers want things a certain way, banks can’t necessarily provide it, because of their infrastructure, or it’s on a technology waiting list.”

Transactions are activated in real time, you get a real time receipt, and there is real time charting. The app learns your spending habits and will alert you of any unusual spending patterns. “It’s like a pedometer for your spending,” Bahk said. “In the same way a walker will respond to the figures on a pedometer to walk an extra 100 yards to reach a mile, we find users spend less when they’re confronted with the figures in real time.”

Moven operates differently than other money management apps like Mint, which offers users a snapshot of all their bank accounts. For example, say you usually spend $1000 per month. You’re halfway through the month and you've only spent $300. Some budgeting apps will say you're doing great, but Moven knows you typically pay all your bills at the end of the month, and you usually only spend $200 by this stage and will send an alert.

Moven's services are built on top of a traditional banking chassis and they don’t actually hold any cash. Deposit accounts are held with CBW Bank, an FDIC member based in Kansas, and card issuance are with FIS. Moven hopes to offer credit cards and savings accounts in the future.

The startup allows you to pay directly from your phone using Mastercard PayPass and is compatible with Android Pay. Bahk hopes the service will be compatible with Apple Pay in Q1 next year. There are also both Apple watch and android wear apps that offer alerts.

The Moven app is only available in the U.S. — the company’s international expansion follows a completely different model. Moven has partnered with Westpac bank in New Zealand and TD in Canada to provide the banks with their own white labelled version of the app. New Zealanders are already using Moven, and TD’s app is expected to launch in Canada in January.

Moven recently raised $12 million in a Series B round and Bahk said it will be used to improve offerings to its U.S. customers. He said to also expect a large international expansion in 2016 with partner banks across the world.

Images via Moven

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