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The US market: are EU-based challengers coming to rustle up some feathers? – FinTech Futures


Are EU-based challengers coming to the US to rustle up some feathers?

COVID-19’s ongoing impression on the world has actually influenced the place of quite a lot of challenger banks within the US market, that are taking greater and larger shares in buyer use on a regular basis.

Whereas conventional banks try to maintain up with the elevated fee of US-based challenger banks increasing their digital banking prospects, EU-based challengers are slowly however steadily crossing over the pond to get their share.

To raised perceive how the market is steadily being reshaped, we selected to analyse 4 totally different situations every representing a digital banking performance that’s more and more changing into well-liked amongst customers.

For this text, we’ll examine which US banks provide foreign money alternate in a checking account, USD transfers in worldwide accounts, funding choices and digital card funds after a buyer has blocked a compromised card. Particularly, we will likely be bearing in mind and measuring their iOS capabilities.

Information supply

To conduct this analysis, the info had been taken from Fintech Insights, a product of Scientia. Fintech Insights is a digital banking analysis platform, the place all options offered by a financial institution all through their digital channels are analysed, measured and listed in personalised charts.

Every digital banking operate is analysed, UX evaluated and captured in useful “how they do it” movies.

Why did we select the 4 situations?

With the pandemic accelerating the necessity for banking digitalisation and an period of renewed outwardness forward within the US, it’s changing into increasingly evident that this must be mirrored in prospects’ on a regular basis banking. Having the ability to take part in an open digital market just by holding and managing totally different currencies is unquestionably consultant of that.

This inherent outwardness can also be seen within the billions of USD transferred yearly to accounts outdoors of the US. This, nonetheless, is primarily executed via a 3rd supplier like Paypal, WesternUnion, and fewer so via a single US checking account. Whether or not a buyer must ship to a pupil learning overseas their month-to-month allowance or cash to a member of the family from a US account to a international account, the necessity stays to be dominant.

The third state of affairs was launched as a solution to the rising buyer curiosity in investments. What the current Gamestop story has undoubtedly confirmed is that investments are not a specialist matter. This elevated curiosity over time virtually necessitates the necessity for the incorporation of wealth administration options right into a financial institution’s digital capabilities.

Lastly, the upper than anticipated enhance in e-commerce gross sales on account of outlets shutting down inevitably led to an increase in on-line fraud. Prospects going via their transactions and discovering a switch that has not been authorised has change into extraordinarily frequent nowadays. They need to be capable to react shortly to defend themselves, block their card, order one other however be capable to buy groceries the identical day and pay. Due to this fact, we determined to incorporate a state of affairs centered on that function.


Situation 1: You’ve a checking account with USD as the first foreign money. You need to have the ability to maintain totally different currencies and alternate between them.

For newly-released within the US market Revolut, the Person Journey to open a brand new foreign money is accomplished swiftly with the choice of a multi-currency account. After a buyer logs into their banking utility, they’re instantly introduced with their account. Tapping on the first foreign money they’re given the selection to alter between currencies or open a brand new foreign money into their account. From there, exchanging cash between currencies is so simple as clicking the shopping for and promoting buttons and typing of their desired quantity to be exchanged.


TransferWise provides that function by utilising a number of separate accounts, Balances. As an alternative of opening a single account that holds totally different currencies, prospects must create a novel account for every new foreign money. As might be seen within the steps flowchart above, once more simplicity is vital right here. Prospects log in, head to their accounts, right here named Balances, swipe left and faucet to open a brand new Stability within the foreign money of their selection. To modify between currencies, they must swipe left or proper, and choose to alternate between currencies by clicking on the related button.

Sadly, the info extracted from FinTech Insights doesn’t point out different US conventional banks or challengers providing this function but.

Situation 2: You’ve a checking account and wish to ship USD to your prolonged household in 5 totally different nations.


Our analysis into iOS capabilities confirmed that solely two conventional banks within the US present prospects with the aptitude of sending cash via an interbank transaction: Chase and Axos Financial institution.

Chase prospects to satisfy this state of affairs must undergo a strategy of 72 steps* omitting a number of data (COVID-19 updates, at the moment’s snapshots), verifying, typing data (activation code, vacation spot checking account particulars, recipient’s particulars), studying the transaction settlement, and even contacting buyer assist for an activation code.

Alternatively, the shopper’s Person Journey for this state of affairs for Axos Financial institution takes 47 steps (25 steps lower than Chase), as is obvious from the above graph. Once more a number of data must be omitted, typed in (goal of transaction, recipient’s and vacation spot financial institution’s handle particulars) and skim. The method, as with Chase, consists of inputting a verification code for the transaction.

TranferWise is the one US-based challenger that gives this function. The financial institution’s customers can full this state of affairs in 32 steps. Steps embrace selecting foreign money to ship, typing in (recipient’s particulars, amount of cash), omitting data (recipient’s e mail, transaction reference), choosing Stability and reviewing data earlier than accepting. Regardless that, as with the above banks, a closing authorisation is required, the transaction is verified via inputting the person’s most well-liked technique of logging into the appliance. It must be talked about right here that in response to which nation a buyer sends cash, a number of further steps is likely to be added or deducted.

However, Revolut prospects are capable of ship funds internationally to any foreign money supported by the financial institution in simply 27 steps. After selecting a foreign money, prospects solely have to sort within the checking account quantity, account particulars and the quantity to be despatched. Like Transferwise, a closing approval by the use of your most well-liked technique of logging in will likely be required.

*Steps might be energetic and passive. Examples of energetic steps embrace tapping, typing, swiping, whereas passive steps are studying, omitting data and so on.

Situation 3: You simply obtained a bonus at work for being worker of the yr. You heard {that a} specific cryptocurrency/inventory is on the rise and also you wish to get on into the motion. Which financial institution will help you shortly open an account and purchase cryptocurrency/inventory?

Inventory shares

Flowchart of shopping for a inventory share through SoFi’s app:


The banks that, in response to our FinTech Insights information, enable prospects to open an funding account on-line, have an summary and/or purchase and promote Inventory shares via their iOS channels are SoFi, BoFA, Ally, Aspiration, Stash and MoneyLion and Axos Financial institution.

Regardless that Huntington, PNC, Citibank and Suntrust provide digital wealth administration choices, all of that are analysed by FinTech Insights, we selected to not embrace them on this evaluation as prospects are unable to open an funding account on-line. Huntington and PNC require prospects to go to a neighborhood department to activate this function. Citibank and Suntrust prospects must make a cellphone name to the financial institution’s monetary advisor to activate a brokerage account.

On the identical word, it must be added that whereas Axos Financial institution permits for an internet funding account opening, the method takes a mean of 1 month to be accomplished earlier than a buyer can start managing their Inventory shares on-line.

Of the banks {that a} buyer can open an account on-line, prospects can purchase entire Inventory shares, handle them and promote them via their utility in SoFI (the method for purchasing a inventory proven within the above flowchart), BoFA, Ally and Axos Financial institution. Aspiration provides solely the buying and promoting of fractional Inventory shares. Via Stash, prospects can purchase fractional Inventory Shares and ETFs, whereas MoneyLion has solely listed ETFs to purchase and promote.

It’s value noting that of those banks, Sofi provides 27 distinctive inventory administration options, adopted very carefully by Ally with 23 and Stash with 20.


SoFi flowchart for purchasing cryptocurrency:


Our analysis confirmed that Revolut and SoFi are the one two US banks via which prospects can purchase and/or promote cryptocurrencies. The shopping for course of is a comparatively fast one for each banks with simply 25 steps to every (as illustrated above within the flowchart above).

Situation 4: You’ve seen a suspicious transaction in your account. How are you going to block your card, concern a brand new one however be capable to go and pay to your groceries that day?

The next US banks full our final state of affairs: MoneyLion, Present, Aspiration, TransferWise and Revolut. With all these digital banking suppliers, prospects can, after noticing a transaction that wasn’t authorised, block their playing cards and apply for a brand new one. Nonetheless, the place we see these banks actually differentiate from each other is how they deal with their prospects’ want to have the ability to pay the identical day they blocked a card.

Present and Aspiration prospects can use the digital playing cards that had been offered once they first opened their account. MoneyLion customers will likely be given an interim digital card, till their debit card arrives. For all three banks, their digital playing cards might be added to Apple Pay.

TransferWise prospects can instantly add their new debit card data to Apple pay, even when it has not but been delivered.

Revolut prospects can each use their already issued digital card in addition to add their newly-ordered card, that has sure to reach, within the Apple Pay.


What clearly stands out from the all 4 particular situations is EU challenger Revolut’s standing within the US market as a frontrunner in offering a Person Journey to all of the situations included. TransferWise comes an in depth second finishing three of the situations. Aspiration, Axos Financial institution, MoneyLion provide two of the 4 options every, whereas Chase, SoFI, BoFa, Ally, Stash and Present one every.

Our analysis exhibits that conventional banks and credit score unions appear to be missing behind in providing these options that mirror actual buyer wants (providing one or two). Additionally it is evident that once they provide a few of the options examined they accomplish that in a much less environment friendly and extra well timed means for the shopper. US-based challengers seem to have an identical place with conventional banks and, once more fulfilling one or two of the situations, except TransferWise.

Even when Revolut appears to be forward of those banks, our huge assortment of information in FinTech Insights means that there are nonetheless options that the EU challenger doesn’t assist. A noticeable instance might be present in our third state of affairs, the place Revolut is just not included within the assortment of banks that supply inventory share administration within the US market.

These 4 totally different situations signify totally different features of necessary person wants. What our data-driven examine clearly demonstrates is that there are market gaps concerning digital choices that prospects crave for. Conventional banks, credit score unions and challengers have to react quick to be the primary to discover these gaps and change into the purchasers’ major financial institution. They should implement options that their prospects want or else they run the chance of changing into out of date.

We’re continually arising with new situations and updating our checklist of over 300 distinctive Person Journeys with new ones. For those who want extra particular situations on what US banks provide their prospects and a big database with over 30,000 Person Journeys on all US banks, challengers and credit score unions, just sign up for a free demo of FinTech Insights.

By Alexandros C. Argyriou, CEO of Scientia

Concerning the writer 

Alexandros C. Argyriou is CEO of Scientia and has been a fintech specialist for the digital transformation of the biggest banks and monetary establishments worldwide.

He and the Scientia staff assist banks convey their digital banking aspirations into fruition by designing services and products prospects actually want.


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