Are the big banks now showing their hand against Monzo by offering more cashback?


(Indy Puaar) #1

Since using Monzo I haven’t used my HSBC visa debit card much. And any transaction I make I tend to always top up my Monzo card to complete the purchase. So today I received an email from
HSBC encouraging me to use my HSBC card to benefit in Visa cashback offers. And it will be pretty hard to ignore up to a massive 25% cashback offers on some stores and retailers. So this got me thinking about how the big banks may react. They could use their huge buying power to secure top cashback deals to retain customers. How do you think Monzo will respond? Cashback feature on Monzo is still something we are waiting for and hopefully will be around the corner soon. But do you reckon they can secure any decent cashback deals? I have a curve card which at best only offer up to 3% cashback.


(Alex Sherwood) #2

Maybe you are seeing a response from the bank’s there, maybe it’s unrelated. It’ll be interesting to see how they do react once Monzo gets to a significant size (1m+ users, by the middle of next year) & I can see why cashback could be part of that.

If that’s what you’re looking for, check out Tail. They’re offering the sorts of %’s that you’ve mentioned for the retailers that they’re working with -

If it was that easy for the bank’s to secure big cashback deals, I don’t see why they wouldn’t have done so before now.

And to be honest, it’s Monzo’s ability to provide a superior user experience that’s one of the main threats to the bank’s. Something that I believe they’ll find much more difficult to replicate.


(Indy Puaar) #3

I did register my interest for the Tail app testing but not heard anything yet. Of course there is big Potential and huge scope for Monzo to add some great features. It has already allowed me to make 99% of my transactions via Monzo and Monzo current account :grinning:


#4

On my Halifax cashback I have earned £3 in about 5 years. I don’t think these are going to make me choose them over Monzo. And if being coerced into dining in certain restaurants was my thing I’d just download Tail to get 50% off stuff.

Here are the offers I’ve got right now on Halifax cash back extras:

These sorts of offers only seem good for people hoodwinking 9 friends into paying them for 9/10ths of the meal then getting theirs for free, or using business expenses to generate personal cash back. I wouldn’t go on my bank on a Sunday afternoon to find out where I should eat today to spend a lot and get a couple of quid back.

Monzo is going to blow this crap away when the marketplace lands.


(Marta) #5

For me it’s the opposite! :smiley: I’m sooo suspicious about all that stuff. It’s basically encouraging me to spend money, by saying “it’s okay, you will spend a bit less, so why not?”. I keep my finances healthy by not throwing money around, and especially, avoiding impulse purchases above £5. If I see 25% cashback, I might go and buy new shoes, but did I need those new shoes? Looking at my closet, I defo didn’t need them :joy_cat:. It might feel like good purchase (I saved money, riiiight?), in reality I just spend money I didn’t need to spend in the first place.

Freaking mind games! :sweat_smile:


#6

My Curve pays 3% at Halfords


(Rhys Short) #7

Lloyds do the same, I find it basically unusable since I need activate them. Far too much friction for little gain.


(Jamie 🏳️‍🌈) #8

Isn’t cashback just the shop taking a load of cash and waving it in your face shouting “you overpay so much we can give you a discount and you still think you’re getting a good deal”?


(Ben) #9

Basically, yes. Really pisses me off too. If you can sell it cheaper, just sell it cheaper.


#10

Agreed, I’d much rather shops just discounted slightly and saved me the trouble of joining lots of schemes or hunting around for offers.

I’ve had Barclays rewards for some time and made little use of it, the only real financial benefit is the blue rewards which pay you for having direct debits, mortgages, loans etc. Innovative companies like Tail seem to be doing a better job of cash back than the legacy banks. Can’t wait for my Monzo CA and for some effort to finally be put back into the API and developer tools so people like tail can launch :tada:


#11

I don’t know whether it’s because of Monzo/Challenger banks or because of new legislation but Barclays have had a ton of updates to their mobile banking app recently. Even going as far as to take the service offline for 7/8 hours at a time to do updates to their infrastructure.


(Jamie 🏳️‍🌈) #12

I think Barclays’ downtime has been to separate its consumer high street business from its investment bank under rules introduced after the credit crunch in 2008. Nothing to do with challenger banks.


#13

I use tail. Its good, although more promising than delivery at the moment.

Here’s my link if anyone wants to sign up. tail.at/?ref=r1xub

As @MIROW mentions curve is fairly useful. I use it alot for business spending at Argos and b&q. It also stacks with topcashback which is quite useful.

Again Sign up with code ZZTD3 & get £5 http://bit.ly/2cSm3VB


(lee) #14

Cant speak for all offers/banks but understand that a lot is actually funded by the end retailer. The last place i worked was approached to sign up to run an offer. So don’t think they’d respond like this.

Basically a third party manages the offers which you see in banks like Santander, Lloyds etc. They agree a discount which is funded by the retailer. The retailer in theory gains additional sales covering the discount offered.

If they get so concerned about a challenger bank they’ll just buy one.


(Jamie 🏳️‍🌈) #15

Think I’d prefer Monzo to offer a good value proposition and differentiator. Not cashback.


(Andre Borie) #16

The legacy banks aren’t concerned at all - there are lots of idiots on this planet that will happily give them business and money, and I don’t see that changing any time soon.


#17

1m+ users “significant”? It’s a piddly drop in the ocean for the real bricks & mortar banks.

A quick internet search show that Lloyds alone have 20+ million saving accounts and 22m+ current accounts. Add on to these numbers their mortgage and business account holders.

Given that most of the UK retail banks have (each) 10’s+ millions of customers, both business, mortgage, current and savings accounts, I really can’t see Monzo affecting or making any difference to them.

Monzo is and will almost certainly remain a small fish in a huge ocean. It will fill a niche space and nothing more.


(Alex Sherwood) #18

I’m aware of that :slight_smile: perhaps ‘meaningful’ would have been a better choice of words.

It’s certainly exciting that there’s such a huge market for Monzo to go after!

I disagree with you about this though, watch this space :rocket:


( surohpotsirhC) #19

It’s significant how quickly they got there.


(Jack cheetham) #20

I think the cashback is more a “we will give away x% of our profit to get new customers through the door”