how do the fintech options measure up? – The Irish Times

Neobanks, challengers, the future of fintech: call them what you like, but the next generation of banking is being driven by the new guys.

With Ulster Bank out of the Irish market and KBC having a foot in the door, the new banks have an opportunity to swoop in and grab customers from traditional banking institutions, offering more flexible features and lower fees. They are also a step removed from the 2008 banking crisis and subsequent bailout, which has colored many opinions of Irish banks.

There are many advantages to going digital. Banks tend to have more innovative features than their traditional counterparts, forcing incumbents to up their game or lose customers.

[ Ulster Bank is shutting its doors. What does it mean for the future of banking in Ireland? ]

With the app as the main point of contact for a digital bank, it must not only be reliable, but also offer everything the customer needs in an easily accessible format. Virtual cards instead of physical ones, the ability to temporarily freeze your card when needed, and alerts every time you make a transaction have become a common feature in banking, primarily led by the new fintechs.

You can now do more, and faster, on apps than you could before, and the credit for that should go to the new generation of fintechs and banks.

No branches means lower fixed costs for the digital banks, which means lower – or no – fees, unless you want the premium features.

However, there are some things you should be aware of. Digital banks don’t have physical branches, which means you can’t deposit checks or cash. Although the use of check has decreased dramatically, there are some cases where you need to submit a check, such as some refunds from companies, insurance claim payments, and so on.

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It also means you can’t walk into a branch and ask for help in person, but you have to rely on online chat or phone support if you have a problem. It’s not always ideal, especially in an emergency, as some customers have found, but most should find it relatively easy to get their questions resolved as needed.

They also don’t have an ATM network, so you rely on other banks and private operators to take the trouble if you need cash, and are therefore bound by their limits and fees – although contactless payments are increasing every month, cash is. becomes less widespread. It should help customers stick to the monthly limits imposed by the banks. Overdrafts are also not an option for many of the newer banking players.

With that in mind, who are the main players in the digital banking space? And are they worth considering if you want to switch banks?

Revolut

Once an upstart fintech, Revolut has matured somewhat since launching in Ireland. Originally used to spend in foreign currency without incurring huge fees from your bank, and to easily share bills with friends, it now offers a range of services you would normally find in a traditional bank, from savings accounts to personal loans, even on its free team account.

Revolut also gives customers the option to use the Pay Later option, splitting the cost of a purchase into three installments. On the way in the next few months is car insurance.

The most recent introductions have been Revolut’s credit cards and joint accounts, but to use the latter, both parties must have an existing personal account with Revolut.

[ Revolut begins offering joint accounts to Irish users ]

With the introduction of Irish Ibans for account holders, one of the last hurdles for many has been cleared. Until recently, it was not unheard of to be told that a business could not pay into a Revolut account on behalf of a customer, despite it acting as a regular bank account. This is called Iban discrimination and has been a problem for customers trying to make or receive payments through their Revolut account. However, Revolut has just finished switching all customers in Ireland from the former Lithuanian ones, which should end any objections.

Apart from the free plan, which gives you five ATM withdrawals (up to a maximum of €200 a month) and currency transfers before fees start, Revolut offers three paid plans.

The most basic of these, Plus, costs €3 per month and adds purchase protection for theft or accidental damage to your phone, tablet or other gadgets for 365 days after you buy them. Another benefit is event ticket protection, which will cover the costs if you have to cancel the planned evening. The catch is that both of these are limited to €1,000 per year. Priority support and full access to two of Revolut’s accounts under the age of 18 are also included.

The intermediate level is Premium, and costs €8 per month for unlimited currency, travel insurance and a discount in the airport lounge. Limits on purchase protection and event cancellation benefits increase to €2,500, with ATM withdrawals at €400.

The top account, Metal, gives you extra benefits, including cashback of up to 1 percent on purchases, reduced fees on merchandise and covers up to €2,000 in excess rental car when you travel, for €14 a month.

N26

German-founded N26 has been around for a while. The digital bank has held its banking license since 2016, meaning your deposits are just as protected as they would be in a traditional bank in Ireland.

The bank offers an easy-to-open account which – all things considered – can be completed in minutes, although it may take a little longer to verify your identity.

At its most basic, N26 offers a free account, N26 Standard, which has a free virtual card and a physical card for a €10 delivery fee, contactless payments and up to three euro ATM withdrawals per month before fees kick in. Customers can also make use of cryptocurrencies.

More advanced benefits, such as the travel and lifestyle insurance, are reserved for the paid accounts, as are features that Revolut offers for free, such as Spaces sub-accounts that can be used to save towards a specific goal and the ability to round up each transaction and move it extra to one of these sub-accounts.

The fees for N26 are slightly higher than Revolut, with the next tier account, N26 Smart, costing €4.90, and the top tier, N26 Metal, coming in at a hefty €16.90 a month. It will give you free ATM withdrawals abroad, reduced fees for cryptocurrency trading and cover for winter sports accidents, car hire and phone insurance.

Bunq

Last year saw the official entry of Dutch-based digital bank Bunq into Ireland, giving another option to people looking for a new bank.

Fintech, which has a banking license from the Dutch central bank, operates in Ireland under passporting rules and has been authorized by the central bank to do so. When it launched in May 2022, it was the first of the new digital banks to offer Irish Ibans to customers, making it easier to get paid or pay bills.

Bunq, which bills itself as the free bank, charges €3 a month for even its most basic current account, although you can try it free for 30 days. It also offers a free savings account.

One of the features that sets it apart from other digital banks is its “green” account. For €18 a month, you can offset carbon emissions by having a tree planted for every €100 you spend on your cards, having a metal card instead of a plastic one and environmentally friendly deposit investments.

There’s a middle ground between the two: the €9 a month Easy Money plan, which includes extras like the ability to have a card in your chosen name, multi-currency banking and the chance to win prizes at least once a day.

Money jar

Irish-founded Money Jar is slightly different from the others in that, while it offers a digital checking account, it is covered by an e-money licence. Your money is still covered and the institutions rely on such licenses as are required to protect the money they receive from customers and protect them. If something goes wrong, the money will be used to pay back customers before anyone else.

It comes with a prepaid debit Mastercard issued by PFS Card Services, so you can only use what’s loaded into your account.

Money Jar is designed to make you think more about your spending and budgeting, but it still has all the basics of a checking account. You can pay bills, set up direct debit, transfer money through Sepa payments and use your card for contactless payments. It also allows you to set up standing orders, which cover almost everything you would ask from a checking account at a traditional bank.