Encouraging its customers to refer friends and family to its service, Curve, the digital wallet has announced its new Refer-A-Friend programme with new incentives. 

The new Curve referral programme offers one per cent cashback on all spending, allowing customers to receive cashback for 30 days for every friend they successfully refer to Curve. There is no limit on how many referrals a customer can make. In turn, this means customers can enjoy up to £30 every month in cashback, or £360 annually. The new one per cent cashback earned is a new perk on top of the previous rewards customers already earn from banks and credit cards linked to a Curve wallet.

Especially beneficial during the cost-of-living crisis, Curve is enabling consumers to have more money flow into their accounts with its referral programme. With the new cashback offering, consumers can get two sets of rewards, or double dip – a phrase used by the industry for those taking advantage of multiple reward schemes at once. Customers link their cards to their Curve Wallet in the app and pay through the fintech to receive cashback on top of any rewards they already get with their bank or credit card.

“Everything we do is about empowering our customers to live their best financial lives. As almost two-thirds of Brits are holding back on spending because of increased living costs, we want to make the day to day a little easier for everyone. With this new referral programme, we’re giving customers the chance to really embrace the idea of double-dip rewards and maximise their cashback,” said Shachar Bialick, CEO and founder of Curve.

“By combining it with other Curve offers and any others from banks and credit cards they use every day, this programme is our way of rewarding customers’ loyalty and making the daily spend more affordable.”

Potential of the programme 

The potential of the Curve referral scheme, and the double dip rewards associated with it, can be demonstrated by the example of Chase UK. Especially as the UK regulated bank currently has one of the strongest cashback offers in the market with one per cent on all spending for the first year.

Blending this with Curve’s referral programme, customers could earn two per cent cashback on all their spending by linking their Chase card to Curve and referring friends. With a monthly cap of £15 on Chase and £30 on Curve – that’s as much as £540 a year in free money.

Earlier this week, payment giants Visa and Mastercard agreed to lower fees charged to merchants for credit card transactions in the US, following a lawsuit spanning almost two decades.

In a move that could collectively save merchants as much as $30billion, Visa and Mastercard have agreed to reduce so-called ‘interchange’ fees by 0.04 percentage points for a minimum of three years, and to cap them at the same level seen at the end of 2023 for five years – subject to approval by the US District Court for the Eastern District of New York.

Interchange rates, set by the two payment giants, generally sit between two to four per cent of each transaction total. According to Rob Beard, chief legal officer and head of global policy at Mastercard, the agreement delivers “certainty and value to business owners, including flexibility in how they manage acceptance of card programmes”.

Currently, merchants in the US can add surcharges to transactions for consumers using American Express cards – but not on Mastercard and Visa cards. But if the settlement is approved, merchants will be able to change the rates they charge for all cards, instead of basing it on the credit card network alone.

However, the majority of interchange fees actually go to the issuer banks, to cover the card services they provide, such as customer support, fraud prevention and to cover other associated handling costs. While it remains unclear which party will take the brunt of the cut, early suggestions look as though the banks will take the biggest hit. Questions could arise over how much of an impact these cuts could have on issuing banks across the US.

In response, Kim Lawrence, president of the North America region at Visa, explained: “Importantly, we are making these concessions while also maintaining the safety, security, innovation, protections, rewards and access to credit that are so important to millions of Americans and to our economy.”

A win for merchants, but a loss for cardholders?

Matt Schulz, chief credit analyst at LendingTree, an online lending marketplace, explains that, while US merchants will enjoy savings, this may not be the case for their customers, who may even become privy to higher fees.

“This settlement is potentially a big deal for merchants’ bottom line, but the financial impact on their customers is unclear. There’s no guarantee that even a dime of these savings gets passed on to consumers.

“Merchants will now be more able to add surcharges to purchases made with credit cards that come with higher swipe fees. That can help them recoup the cost of accepting those cards, but it also risks alienating customers.

“These changes come with some real risk to merchants. For example, a high-end credit card may cost more for a merchant to accept, but the typical user of that high-end card might be an extremely desirable customer with a lot of spending power. This dilemma is going to lead to some very interesting conversations within these companies.

“The measures in this settlement that allow for more surcharging and greater competition could lead to swipe fee reductions well beyond just what is mandated. The ultimate impact of this settlement on credit card rewards and the industry as a whole will depend on how that all plays out.

“Banks have plenty of levers to pull and buttons to push when it comes to recouping revenue in cases such as these. It is reasonable to expect that we might see other types of bank fees rise once the settlement is finalised. Banks don’t tend to take these types of changes lying down.”

Impact on issuing banks

Brad Goodall, CEO and co-founder of Banked, a fintech powering open banking payments, explains how the settlement between Visa and Mastercard could impact issuing banks, and how fintech could resolve future issues: “Mastercard and Visa have committed to maintaining average interchange fees at least seven basis points lower than the current rates over the next five years, providing a period of stability for merchants after a US judge clears the settlement.

“The big questions are; will this introduce surcharging at point of purchase and if so what will that do to consumer experience and cost? Will this open a door for alternative payment methods?

“The deal will also negatively affect issuing banks, which will take a moderate hit to the revenue they collect amidst a tough macroeconomic climate for banks as interest rates remain stubbornly high. Issuing banks are largely responsible for ensuring fraud is monitored and kept out of the system and they use part of this interchange to fight fraud.

“It’s key that fintech steps up to provide reliable and importantly, safe alternative payment methods for both merchants and banks. One promising path for innovation is Pay by Bank, a payment method built on global open banking payments rails, vastly reducing fees and providing near-instant settlement, whilst shoring up revenue for issuing banks.

“The collaboration between banks and fintechs to innovate on account-to-account rails is paramount. This partnership provides a unique opportunity, particularly as issuing banks face mounting pressures from diminishing interchange fees. This pressure incentivises them to envision a future where they can chart their own course towards a new network model. By harnessing core payment services and fraud tools, they can create a novel, real-time payment method that benefits merchants and consumers.”

Bank revenues ‘remain quite steady’ 

Not all agree with the idea that reduced interchange fees will genuinely hurt issuing banks. Dan Carter, senior director and head of global payment strategy at Redbridge Debt & Treasury Advisory, a global financial management partner to corporations, appears to suggest this, as he highlights that consumers shouldn’t fear significant additions to their bills.

“From a consumer perspective, there should be little to no major changes. Interchange rate increases have far outpaced the proposed decreases.

“As of October 2023, high-end rewards cards issued under Visa and Mastercard have reached 2.6 per cent plus $0.10 for interchange alone – up 0.1 per cent from just April 2023. Issuers may complain and may deflect with comments about fraud losses and bad debt write-offs, but their revenues remain quite steady.

“While surcharging, allowable since 2013, is more prevalent post-COVID, merchants who accept American Express are still bound by the terms of their agreements.

“What may be allowed under Visa and Mastercard may be prohibited under American Express, a network known for aggressively pursuing ‘honour all’ and anti-discrimination practices.”

Looking to the future of payments

Kjeld Herreman, head of strategy advisory at RedCompass Labs, a fintech consultant and accelerator, also explains how, even if the settlement comes into play, merchants worldwide could still benefit from other payment solutions; even those based across Europe, where interchange fees sit at around 0.3 to 0.4 per cent.

“Every card transaction that is made costs businesses money, and they usually must wait two to three days after taking payment for any money to reach their account. When it arrives, they’ve lost a chunk to interchange fees. Money that could be used to pay staff, suppliers, rent, and bills goes to the payment processor. Not only is the business worse off in real terms, but waiting for the money to arrive can create pressure with suppliers and staff who need to be paid.

“P2B real-time payments are a solution for merchants everywhere who are tired of paying interchange fees and waiting days for their money to arrive. The faster the payment, the faster the business is paid, the faster it can reinvest, and the faster it grows.

“The EU is attempting to tackle this issue to reduce the power of large foreign businesses. The European Payments Initiative is building a card-like scheme on top of real-time payment rails, as well as adapting interchange and chargeback processes. It is also mandating that all banks must be ready to send and receive real-time payments by the end of 2025, levelling the playing field between PSPs and card networks.”

GWI is a U.K.-based research firm providing global audience data to merchants and agencies. According to GWI’s 2024 “Connecting the Dots” report, chat and messaging are the most favored apps among internet users, with 94.7% of those aged 16 to 64 stating (in January 2024) they’ve used at least one of these platforms in the last 30 days. Social networks are also widely utilized, with 94.3% of the same age group reporting usage in the past month.

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Nearly 61% of GWI’s survey respondents in the 16 to 64 age group stated that their primary reason for using the internet is “finding information,” making it the most prevalent rationale. “Staying connected with friends and family” is cited by 56.6% of respondents as their primary motivation.

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According to Similarweb, Google.com was the most visited website globally, with 81.1 billion visits in February 2024. YouTube.com and Facebook.com came in second and third with 30.6 billion and 15.3 billion respectively.

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Per the GWI report, Instagram is the most popular social media platform globally, chosen by 16.5% of internet users aged 16 to 64. This percentage is more than double the 7.4% who favored TikTok.

Klarna has introduced open banking-powered settlements in the UK, enabling consumers to pay directly from their bank accounts instead of using debit cards.

This move marks a significant shift in the global payments and shopping solutions provider’s ambition to create a future-oriented payments network. Open banking settlements simplify and secure transactions for consumers while providing insights into spending habits.

Established in 2005, Klarna has focused on accelerating commerce and now boasts more than 150 million active users worldwide and facilitates 2.5 million transactions daily.

Open banking settlements have been introduced for Klarna’s Pay Now instant payment option, with plans to extend this feature to Pay in 30 and Pay in 3 later in 2024. This launch is poised to significantly boost open banking adoption in the UK, where approximately five million Britons utilise open banking payments monthly.

Outside the UK, Pay Now by bank is already live in 10 countries around the world and is regularly used by over 20 million consumers each month.

Pay by bank

To complete a payment, consumers select ‘Pay by bank,’ redirecting them to their mobile banking app for a swift and secure transaction.

By linking their bank account to Klarna, consumers gain access to spending insights and budgeting tools within the Klarna app. Moreover, sharing bank data enables Klarna to make more informed lending decisions based on the consumer’s actual spending habits, ensuring a tailored fit with their budget.

Wilko Klaassen, VP, open banking at Klarna, said: “Open banking offers a huge opportunity for Klarna to reduce the cost of payments to society by cutting out the established card payment networks, and using up-to-date bank account data to make ever better lending decisions. This new launch builds on the success we have seen in 10 countries across Europe and will give UK open banking a major boost.”

Financial incentives related to switching banking providers have been well-publicised across the UK. However, new research suggests that for many UK consumers, a positive customer experience ranks as a higher priority, leaving many happy to simply stay put. 

In fact, good customer service is the main reason that around 40 per cent of UK consumers stay with their current banking provider; European customer service software provider Odigo has revealed. The importance of feeling valued by their bank was also highlighted as it revealed that 47 per cent realise they miss out on better financial service deals by not switching.

The findings show that amid ongoing financial constraints, around 19.4 million UK adults consider good customer service at least as equally as important as financial savings.

This comes as financial expert and consumer champion Martin Lewis recently claimed that anyone with a bank account risks losing around £200 by not switching now. However, the Odigo research shows that 35 per cent of consumers believe they don’t lose money by staying with their current provider; while 40 per cent of consumers also cite strong reputation and trust as another key reason to stay with their banks.

At the other end of the spectrum, poor customer experience was named as one of the top reasons to swap providers by 35.7 per cent of consumers. Around 37.4 per cent named better interest rates as a reason to stay.

‘Good customer service is still king’

Vincent Lascoux, chief customer success officer at Odigo, offered his take on the findings: “The research has spoken – despite the financial challenges and difficulties faced by consumers, good customer service is still king when it comes to retention.

“Whilst banking providers should continue using financial benefits, such as cash incentives and better-saving rates, to encourage customers to switch, as part of their strategy, this must not come at the expense of a positive experience for their existing customers.”

As banks continue to focus on digitally innovating their offerings and processes, they cannot afford to let the quality of their customer service drop. Instead, they must look at investing in platforms such as chatbots, website updates, and social media reactivity to ensure they are meeting customer expectations.

Investing in customer service is especially important for incumbent banks that are facing increased competition from challengers, such as Monzo and Starling Bank who ranked at the top of the Competition and Markets Authority (CMA) and Which? customer satisfaction rankings.

It is uncommon for consumers to only have one payment option nowadays. While preferred payment options exist, many have multiple credit or debit cards with existing points on them that they are unaware of. Looking to ensure consumers are making the most cost-efficient purchases with the cards, and in turn rewards, available to them, Redeem, has launched out of beta. 

Whether planning a stay at the Marriott or making a purchase at Nike, Redeem steps in to guide users on maximising their credit card benefits by analysing which card is best for every purchase. It aims to instil confidence in consumers, ensuring they redeem available rewards wisely or save them for more favourable redemption rates.

Recent studies reveal that the average consumer possesses over four credit cards, collectively accumulating a staggering 48 trillion points globally, equating to approximately $360billion in value. Astonishingly, 30 per cent of these points, representing over $100billion, remain unredeemed due to the complex nature of reward systems. Consumers are often left bewildered, unsure of when and how to redeem their benefits. As a result, many miss opportunities and leave value unclaimed.

“The idea for Redeem originated when I created a spreadsheet to manage my own credit card rewards. I realised there had to be a more intuitive and efficient way for everyone to unlock the full potential of their credit cards, and thus, Redeem was born,” says co-founder and CEO Charles Parietti.

Key features

• Real-time analysis of multiple payment methods (credit cards, memberships, etc.) at the point of purchase.
• Notification of available offers/benefits/rewards in real-time on a per-card basis.
• Auto Opt-In to offers.
• Notification of which card is best to use based on each users own preferences.
• Insights on when to redeem loyalty points.
• Easy to install Chrome Extension.

“In a world where consumers are inundated with credit cards, each boasting its own set of points, cash-back systems, and a myriad of rewards, it can leave people confused and missing out, says Gregg Jackowitz, co-founder and COO.

Version 2 of Redeem aims to add redemption rates for point loyal programs, notify users of available offers, and even auto-applies points, coupons, or cash-back offers at checkout.

PensionBee, the online pension provider, has entered into an exclusive, non-binding term sheet with a large, US-based global financial institution to expand into the United States in late 2024.

Under the proposed strategic relationship, PensionBee will deliver the US service through PensionBee Inc, to be established in Delaware as a wholly-owned subsidiary of PensionBee Group plc, with operational headquarters in New York.

Recognising the opportunity in the US market, presented by the world’s largest defined contribution pension market, which represents around 80 per cent of the global total, the pension provider hopes to enable US consumers to consolidate and roll their 401(k) plans into a new individual retired account (IRA).

PensionBee will manage all operations of the new US business, including hiring a local team, making its online retirement proposition available and UK-based proprietary technology to consumers in the US defined contribution market.

Romi Savova, founder and CEO of PensionBee, commented: “In the year of our 10th anniversary, having demonstrated underlying profitability, we have entered discussions with a view to deploying our award-winning customer proposition, supported by our innovative technology platform and marketing approach, in the United States of America. This is a transformative step for PensionBee and for our stakeholders.

“By entering the world’s largest defined contribution pension market, where many consumers still struggle to prepare adequately for retirement amidst an array of confusing and difficult-to-use investment options, our straightforward approach to online retirement savings will help millions of consumers look forward to a happy retirement.”

Planning for growth

In the UK, following close to a decade of operations, PensionBee will continue to grow its market share in the £1trillion defined contribution pension market following current guidance on revenue growth and profitability, operating the UK business as financially separate from the new US undertaking.

At the end of 2023, PensionBee had £4.4billion of Assets Under Administration on behalf of approximately one-quarter of a million invested customers. The firm also achieved ongoing Adjusted EBITDA profitability at the end of 2023 and expects to be profitable in the UK on an Adjusted EBITDA basis for the full 2024 financial year.

Given the context of the enormous US market opportunity, PensionBee sees the potential for its US business to grow rapidly, becoming at least the size of its UK business over the next decade.

Travellers have sometimes struggled with protecting their valuables like smartphones, tablets and laptops due to poor insurance clarity on how to make a claim and if they are entitled to coverage. A new partnership between insurtech bolt and WorldTrips, the travel insurance plan and assistance service provider, is looking to solve this pain point.

Covered travellers will have access to fully digital 24/7 online claims process provided by bolt, allowing them to file a claim easily at any time and from anywhere in the world. The long wait till they get home from their trip to make a claim is no longer a factor.

Travellers have access to bolt’s global repair network that will help them get quickly reconnected to keep in touch with friends and family while traveling. They will also be able to maintain access to important features like cameras and location sharing, and information such as digital wallets and emergency contacts stored on their devices.

Clayton Bodnarek, EVP of alternative distribution, bolt, said the partnership reinforces the company’s mission to respond to customer needs and protect customer devices when they need it most.

“Our work with WorldTrips speaks to the importance of staying connected with friends and family while travelling, especially for students and those who are travelling for business,” he said. “Together, WorldTrips and bolt developed a solution that is affordable and easily accessible to every type of traveller, providing peace of mind that you will be protected and connected even when you’re away from home.”

Only pay for what you need

With bolt and WorldTrips’ offering, travellers can add this important coverage for their devices when purchasing their travel insurance and pay only for the device protection they need while they are travelling. The plan covers all individuals and their devices in the travelling party of the insured, helping customers save time and money.

“At WorldTrips, we are constantly considering pain points that impact travelers and finding ways to address them with simple and affordable solutions,” said Mark Carney, president and CEO, WorldTrips. “We see bolt as an ideal partner because of their unique device protection product that is easily accessible at any time and anywhere in the world. With people storing so much critical information on their devices these days, it is paramount to ensure those devices are protected when people travel.”

Since launching its device protection capabilities in June 2022, bolt has announced partnerships with several global insurance leaders. Additionally, partners have seen up to four times year-on-year growth in policies sold through the program.

WorldTrips, located in Carmel, Indiana, is a member of the Tokio Marine HCC group of companies. Tokio Marine HCC is a specialty insurance group and a member of the Tokio Marine Group, a premier global company founded in 1879 with a market capitalisation of $49billion as of December 31, 2023.

Significantly increased costs, paired with higher interest rates, are leaving over half of people in the UK to regularly worry about their financial situation, new research from Moneyhub has revealed.

The middle-aged emerged as the most likely generation to feel the pressure on their purse strings, with 63 per cent of 45 to 54-year-olds indicating they are worried about their finances, Moneyhub revealed. While a total of 31 per cent of those surveyed admitted to putting off life goals (such as having children), due to not being able to afford it, this figure shot up to 48 per cent for 18 to 34-year-olds.

Following a difficult year for personal finances, 44 per cent of respondents said they had to dip into their savings in the past 12 months. Meanwhile, 28 per cent are struggling to save, while 18 per cent have an erratic approach to savings, with some months being better than others. Overall, only 15 per cent of respondents can save a significant portion of their income each month.

Other new Moneyhub research also found that retirement is at risk for two in five, due to struggles related to interacting with pension or investment providers.

In total, 42 per cent of consumers stated that they do not find it easy to interact with their provider, with 25 per cent citing that the biggest reason for communication being difficult is their provider not having an app.

This difficulty in communicating with providers could be leading to poor customer outcomes. Thirty-six per cent of consumers aged 35 to 44 years said too little information is putting them off adding to their pension; while 13 per cent of consumers don’t even know who their provider is.

Does open banking hold the answer?

In both cases, Moneyhub research suggests that banks and financial institutions, as well as pension providers, could all be doing more to help. Around 34 per cent of respondents said that banks and financial institutions don’t make it easy to understand finances, and 31 per cent said that they would save more if they understood their finances better.

When asked what they think banks can do to make life easier, 16 per cent said that they’d like nudges for when they could be saving money or switching to better savings rates. Thirteen per cent would like access to free money management apps that allow them to see and understand all their finances, and 12 per cent said they wanted easier methods to contact customer services.

Kim Jenkins, managing director of Moneyhub API, said: “Our research makes it clear that there is an opportunity to help customers understand and manage their finances. By using the available technology, banks and financial institutions would be able to help their customers properly understand their financial situation and provide smart nudges that would help them make better financial decisions.

“Through open banking capability and easy-to-build solutions such as Moneyhub’s Smart Saver API Recipe, banks can provide a helping hand for their customers to budget and know precisely when they have excess to save. This will also enable them to deliver better customer outcomes.”

Bettering pension support 

Mark Horwood-James, managing director at Moneyhub Personal Finance Technology, explained how pension providers could implement better technology to support adults across the UK as they plan for retirement: “Consumers are saying loud and clear that pension and investment providers can be doing more to help them make better financial decisions. It is also striking how in-demand technology is from customers.

“Apps and specifically the use of open banking and open finance technology can contribute to better financial wellness and encourage positive outcomes.

“The ability for consumers to see a holistic picture of their finances enables them to make decisions that can improve their long-term financial health. Pension and investment providers could have a huge impact in this area, creating brighter futures for their customers and their businesses.

“The UK Government’s new smart data sharing laws (DPDI) and pensions dashboard announcement – alongside the continued emergence of open finance is accelerating the race to deliver customer-centric solutions. And the next few years will rapidly reveal who leads, and who gets left behind.”

The need and desire for fraud protection has evolved. Once simply viewed as a necessary overhead, good fraud prevention measures are now a very strong way of obtaining new customers and keeping existing ones. In fact, nearly three in four consumers (73 per cent) rank good fraud protection as a top three consideration when opening a new account according to FICO research.

FICO, the analytics company, published a report, titled Fraud, Identity, and Digital Banking Consumer Survey 2023 – United Kingdom uncovering Brits’ attitudes towards fraud and cybersecurity measures. It reveals at what point consumers decide to stop their onboarding process due to complicated measures.

“Financial institutions should use fraud protection as a competitive advantage,” commented James Roche, a principal fraud consultant at FICO. “Customers are looking for providers they can trust, so institutions should shout about the excellent fraud protection they provide. But when it comes to application and onboarding, they must be sure those protections, fraud checks and identity proofing are appropriate, proportionate and time-efficient to reduce the chance of dropouts.”

While 73 per cent of consumers said fraud protection was a top three concern when opening a new account, 34 per cent ranked it as a top priority. Biometrics were a top choice for security measures with 68 per cent preferring to use fingerprints. Just a few years ago biometrics was an unknown science for consumers. The FICO research shows the shift, as 54 per cent believe fingerprint scans provide essential protection; 52 per cent ranked face scans and 49 per cent iris scans.

However, more education is still needed on behavioural biometrics, with just 17 per cent believing these provide excellent protection.

Complicated, but not too complicated

However, firms must walk a fine line as making identity checks too complicated would result in account opening abandonment as almost one in five (18 per cent) said over-complication or time-consuming set-up put them off opening a new account.

Whilst 34 per cent said they are more likely to open a financial account digitally than they were a year ago, the expectation for a frictionless experience has also increased. Consumers expect the application process to be fast. Almost one in five will abandon an application if the checks are too difficult or take too long. Two-thirds expect to spend less than 30 minutes opening a current account.

“If one place in the onboarding process sees a high proportion of dropouts, FIs should consider altering the order in which checks are made and whether some could happen once the customer has been accepted,” added Roche.

Biggest fears

The FICO report also identifies the financial crimes that consumers are most worried about. Identity theft to open a new account is the top-ranked concern at 30 per cent. Bank account takeover was ranked the crime most feared by 20 per cent of respondents. In third place, 16 per cent ranked being tricked into sending money to a fraudster as the top concern. Giving customers confidence that a financial institution is using the best processes to mitigate against these threats is, therefore, critical.

“Aiming for completely frictionless experiences could leave a financial institution over-exposed to fraud,” concluded Roche. “Indeed, appropriate friction can actually help customers feel protected. The reality is, checks must be proportionate and personal to each customer and interaction. Therefore, fraud protection needs to be adaptive. It must use all streams of customer data for the best outcome for the customer and the institution.”