1036. News: Checkout strikes a chord with Spotify as Nubank, Revolut and Starling set their sights on the US

26:52From personalization and investments to AI chatbots and crypto, end users are more empowered than ever when it comes to managing their money. And we expect that trend to continue through 2026. If you're interested in keeping up with the latest product trends, feature releases, and UX insights from brands like Monzo, Revolut, Starling, Nubank, and more, then 11FS Pulse is the tool for you. Benchmark your product against the very best by analyzing over 20 ,000 user experiences from more than 850 global brands, each handpicked and analyzed in depth by product specialists. Find out more at 11fs.com slash pulse.

27:35Now for a quick break from the headlines to tell you all about our latest insights pod. Want to know what's coming next in financial services user experience? Drawing on insights from this year's 11FS Pulse report, we dive into our six biggest user experience predictions for the next 12 months. It's out now, just head to the podcast below this one. Okay, our next story is that London fintech Taya is launching in Spain and Italy amid European expansion. This expansion means that Taya, which was previously known as SaltPay, now serves customers in nine countries across Europe, including Croatia, Hungary, and Portugal.

28:16According to Taya, the growing SME economies of Spain and Italy present a significant opportunity for the fintech to become a financial ally to small businesses. Founded in 2019, Taya offers point-of-sale solutions with fast settlements, business accounts with a Taya card, and flexible credit, all managed through a single app. The company is backed by a series of investors such as Tiger Global and Ribbit Capital, employs more than 200 staff, and posted turnover of£19 million in 2024, more than doubling its turnover the previous year. There's a lot of stories about payments this week, as so often.

28:58um chantal what do we think about the opportunity in spain and isle obviously big economies um is that a logical move for a for a fintech based in the uk and portugal i guess there is you know i think if you there's as good a country as any right i think it's my knowledge of um payments is pretty uk specific but i can see how there's a lot of smes i can see how there's a lot of entrepreneurship. I always think of Spain and Italy. I think of lovely small cafes that you've got to have a point of sale. Like I can see how that would make a lot of sense as a place to expand. And yeah, I guess I was trying to see if there was kind of more information as to whether or not they'd focus there as a next step for a reason.

29:43I don't know if they've got people in the business that know that market particularly well, or if they've got, you know, there's probably demand that they've seen people asking for it to be kind of released in those markets. I'm sure they will have had good reasons to pick those first. Yeah. My hunch is that because they've got operations in Portugal and they're working in Portugal, Spain in particular is a very easy move from Portugal. And so then if you're moving into Spain, then Italy seems fairly logical. As you said, they're sort of somewhat similar economies, somewhat similar, you know, nice weather.

30:16So, you know, you get, which I mean, and that matters because actually you're right. You know, you need more point of sale devices when you've got sort of outside cafes and things like that. Stephanie, obviously, you know, there's already a crowded market, right? There's a lot of point of sale payments providers that have launched all around the world. How do you, how could you break into a market like Spain or Italy where there's existing providers? providers, you know, there's not many cafes or shops that don't have some kind of point of sale terminal. So what's new? How do you create differentiation?

30:56How do you create excitement about a new provider coming in, do you think? And I know that's a hard question. I'm asking you to write a strategy for them. Well, I am actually really interested in thinking about what their strategy is. One, I think, you know, them actually changing their name has a lot to do with the signal about wanting to be more globally dominant and being able to be kind of representative of a broader market than where they started initially. But specific to your question, you know, I imagine that the point of sale options that are distributed today, if I just think about like my own experience, when someone walks up with a device that's like the size of a, you know, a cell phone from the 1990s, it's clunky for them to execute that in their cafe.

31:38Or if they're, you know, selling a Las Rambas in Barcelona, like some street vendor might want to be able to accept card and have better options. I can think of lots of examples within these markets for both like micro businesses and also like traditional SMBs where just the move to being able to use the phone itself as the device for tap-to-pay is one, I think probably a very substantial cost savings. Those point-of-sale solutions are expensive to deploy, expensive to run. And so just getting like more modern in that regard and then thinking about all the things that they're claiming to package, right?

32:13Flexible credit. That sounds a lot like, you know, what we saw Square Capital do, but it also sounds like things that Toast has specialized in specific to the restaurant industry. So my sense is that they're going to need to find perhaps a bit more specialization. The SME economy is like a very big TAM potentially, but what is the area of specialty that allows them to enter and expand is going to be interesting to keep track of was less, I think, visible outside of the regionalization. But, you know, thinking about currency fluctuations, regulatory complexity, access to financial services, you know, perhaps in Spain and Italy, that's going to track closer to Western Europe.

32:52But as you start to go into the countries like Croatia, Hungary, you know, they are further behind in their development of economic infrastructure. And those countries can be gateways into, you know, further into Eastern Europe, which is, I think, a very significantly untapped market when it comes to payment modernization. Really, really interesting, yeah. Dave, what did you think of this story and the opportunity of serving small businesses right across Europe? Yeah, I think, you know, they've done well in the UK because they've got the, you know, particularly the sole trader market, that entire ecosystem with the debit card and the cashback on the debit card as well as the payment side of it on that sort of business account, even if it is only on an EMI.

33:38I think that will replicate well into Spain and Italy. I was in Spain in September last year in some quite small vineyards, and there was no way to pay without cash in a lot of them. Because a couple of them said, I can't get a card machine from my incumbent bank without it costing me a fortune, and I don't do enough transactions on it. And so the only option was either cash or PayPal. which then is, you know, you kind of just stood there trying to work it out and type the numbers in between or share a QR code between people's phones to make that work. So I think this would work well for those sort of small vendors and, you know, whether it's a small winemaker or people in the markets or small cafes and things like that to bring that whole ecosystem together of being able to manage your business and not just the payment side of it.

34:34I think these are fiercely competitive markets. And I completely agree with you that there's lots of sort of underserved SMEs and so on. And there's a missed opportunity to help them. But I also think there's a lot of competition from both the sort of e-commerce payment leaders like a Stripe or whatever, but also others like Molly, like Square, you know, you were mentioning SumUp and so on. So super interesting opportunity, interesting move. And also interesting to see Teo, as you say, becoming sort of more of an emerging player. It's an interesting business because it's a bit of a roll-up of a number of different businesses that have rolled up through acquisition and then sort of trying to shape it into a new thing.

35:16So, yeah, it'll be very, very interesting to watch that develop. Okay, well, let's move on to our final story, big story of the week, which is that Robinhood UK is rolling out stocks and shares ISAs, or individual savings accounts, with a 2 % cash bonus. So with this new individual savings account, or ISA, UK customers will be able to access around 5 ,000 listed stocks and American depository receipts with no platform fees and no commissions. Robinhood also said that customers will be able to earn 2 % back on new eligible ISA contributions when they fund their account before the 5th of April 2026.

35:56The contributions will have to be held for a year for customers to keep the full cash bonus. Jordan Sinclair, president of Robinhood UK, said, Investing should be rewarding, not costly. It's time to give investors a real advantage by changing the incentives in a market that's made it too hard and too expensive to get started. Chantal, what do you think? I mean, Robinhood sort of shook up the American market, now it's trying to do the same in the UK market. Do you think this is significant? Is this a big deal? Yeah, I think it's exciting. Look, I think there's a lot of talk in the UK about ISAs at the moment, right?

36:34There's been a lot of changes from the government in terms of what we can keep in stocks and what we can keep in shares. There's been a historic educational push to get more people investing in the stock market, which is great. So I think it doesn't surprise me to see companies kind of launching ISAs. And more competition is always good, keeps costs down, or at least that's what we hope for. I think what Robinhood should be able to do well is a combination of kind of relatively passive and relatively active investing in one place so I'm a light year customer I have both my ISA and also I have wise shares from when I used to work there having both in one place works really well for me which I imagine is something that Robinhood will be able to do possibly as well and I think But I think where it gets interesting is the type of person who would use Robinhood to buy shares and do retail investing might be different to the type of person who opens a stocks and shares ISA.

37:31And I think what these companies will need to be careful of is making sure that they are, to quote you from earlier, Stephanie, meeting the customer where they are and kind of understanding what they need in the product and the service. because if you're a novice to investing and you come in and you just want to open an ISA and you're maybe getting funneled towards something a little bit more complex, that can be A, quite intimidating and B, quite dangerous for the customer. And I think whilst this in theory has a lot of really good potential upsides in an environment where we are being really mindful about getting more people into investing but wanting to do that cautiously and safely, I think that's going to be something that regulators need to keep an eye on.

38:13And Robinhood has sort of been looked at in the past for maybe encouraging people to take perhaps more risks than they were planning. Stephanie, do you have a view on this? What do you think? You know, as a financial planner, I've seen this conversation play out in a lot of different avenues. One, in the U.S., people laud the ability for Robinton to actually capture the retail market in a way that no one really has previously. One of the best ways to build wealth is to invest your dollars, right? And I think that fundamentally, that is something to be excited about. But as Chantal pointed out, both in the U.S.

38:51and now with the ISA expansion in the U.K., it begs the question of, you know, how much of this is a push towards sort of active trading versus long-term sustainable investing? How educated is the saver, the investor, the end user about what they're actually getting into? and, you know, while this is kind of like a trusted, you know, product already that exists and there's cultural adoption for it, that doesn't mean that everyone who signs up and opens this kind of account understands that there's risks when they invest money, that there's risk of loss. What kind of, you know, decisions they're going to make, what the tax implications are of those decisions, things like that come to mind when I think about just striking the right balance.

39:35I think overall, I'm like net positive, both on Robinhood broadly and on this expansion. And what I like about the way the bonus is structured is this 2 % isn't just, you know, cash up front. It has to be in the account for 12 months, according to what the T's and C's say. And so I think that lends to being a little bit more in line with, begin a habit of investing for the future, put money here, keep it here, keep going, as opposed to just trading. But time will tell as to how, you know, this behavior looks and what maybe under the hood is available through that account structure over time versus what today is kind of a limited set of offerings from a U.S.

40:18market perspective. It's also an interesting question about how are they funding that 2 %? Where's that 2 % ultimately coming from? I mean, you can't buy customers' information. marketing. It's CAC, right? Like this is just, I could acquire you through ads or I could give you a compelling cash-based reason to put your money to work in the system. So I think it's CAC. It may be. Dave, we were talking earlier about, you know, sort of foreign banks moving into the States. And here, of course, we've got, you know, effectively a foreign firm moving into the UK, even though Robin Hood, of course, was British.

40:52I mean, he wasn't necessarily a real person, It's a different conversation. Dave, what's the advantage of foreign companies coming into the UK or coming into any market? Obviously, they kind of have the existing infrastructure. They have the existing sort of app designs and site designs, so they can kind of launch with a fully-fledged proposition. But do you think, do foreign entrants tend to win out, or do the domestic firms manage to respond? I mean, what will some of the UK firms or European firms be thinking about Robinhood coming in? It'd probably be interesting where they're sort of leaning towards as a demographic that they're trying to get into this as an account, whether they're aiming more sort of Gen Z and trying to sort of get the glamour of investing in US stocks and shares, but through a safer route of an ISA than going to single stocks and things like that.

41:48But, you know, you can look and you can say, you know, I've got my money in such and such a fund. But actually, does that mean anything if you're talking to someone, you know, and you can actually point and say, well, that fund has got a lot of, you know, US tech shops or stocks or SpaceX or whatever in it. And so that becomes more interesting. My worry about this is, is it actually a route they're trying to actually shift people away from ISIS to actually real trading through getting people in as a start point and saying, now you're in stocks and shares, should we help you towards a general investment account?

42:29And that would be really worrying because that's a very different person, very different education level as to how you can work in that sort of environment. and so time for me will tell as to what they're trying to do with this as to where they are. I don't think the 2 % is that big a deal. That's not headline if you look at what people are pushing to try and get people into their ISAs before the end of the tax year that people are offering more than that. So I'm not sure how much that will grab people but they've got to offer something because everyone's offering something. to get people into their ISIS.

43:11Chantal and Stephanie, do you agree with Dave, you know, that concern he has that, you know, because, you know, Robinhood offers options trading, futures trading, margin investing, stock lending. You know, these are some quite advanced capabilities. Do you share Dave's fears that the end game here might be trying to get people to move from stocks and shares investing into, you know, more sophisticated strategies? I think it's certainly a risk that is present in thinking about what is the right mix. That said, I think for all of time, there are investors who will go straight to insert digital brokerage account of choice and go do something that is probably unwise financially from an investment perspective due to either lack of education or just like they heard a headline.

44:03So I think in some ways it is a little bit inevitable. What I think the balance and the question here kind of hinges on is, what role is Robinhood playing in pushing products that maybe aren't suitable? And is the suitability threshold being met? So while they disclose a lot, and I am a Robinhood customer, so I have seen all these disclosures, when it comes to doing something like, you know, the futures market products, they disclose, they disclaim, but they don't prevent you from clicking the button and ultimately now participating in what I think many are considering legalized sports betting in the U.S.

44:41via this product. And so it is a very fine line of like making it available for the right investor types versus encouraging use of something that is extremely high risk and lacks the suitability fit for someone whose risk tolerance, whether that's by age, total dollars that they have in their portfolio, I mean, a variety of factors come to mind. But the worst case scenario that I worry about is someone who intends to do well by putting in some portion of their savings to grow their wealth, ends up with a deep loss and is set back financially due to lack of understanding. What do you think, Chantal?

45:18Yeah, I totally agree. I think it's a very valid concern and I think it's something that us as an industry and regulators need to keep an eye on. I think there was also a really interesting story towards the end of last year, I think around CFDs, and the FCA had said that 70 to 80 % of people who traded CFDs made a loss and they were still being not just made available, but kind of pushed on some retail trading platforms. So I think there's also potentially ambiguity and the lack of transparency on how some of these retail platforms make money. Because if you're being given everything for free, then at what point are they making profits and how are they doing that?

45:55I think there's definitely some rigor that needs to be kind of put in place for some of these companies. I do still think, I'm with Stephanie, I think net positive on Robinhood. I think this is hopefully doing the right thing and going in the right direction, but something we do need to keep an eye on. I think ICE isn't investing, whilst they are very similar and obviously very closely linked, they are actually quite different behaviors. And I think we need to keep an eye on making sure that people understand what they're doing with their money. Yeah, I'm in a very similar place to you. I think Robinhood's done a fantastic job of app design, of simplifying investing, of encouraging people into investing.

46:31But, you know, I do have some questions about the business model and so on. And, you know, Robinhood makes money in the States in ways that are difficult to do in other markets or illegal in other markets and so on. So there's some interesting dynamics behind the business. So fingers crossed, it's a positive. Okay, well, let's take a quick pause here and we will be back very shortly.

47:02Okay, now for two stories that we don't have time to cover in full. Firstly, Chase has entered the UK insurance market with the launch of an insurance bundle. So the digital bank Chase has launched its first insurance product in the UK called Chase Protect, positioned as a simple good value bundle of everyday cover. For a fixed£12.50 a month, customers get worldwide travel insurance, mobile phone insurance, and UK breakdown cover in a single package. The key angle here is convenience. Customers can buy, manage, and submit claims entirely in the Chase app, with the insurance offered as an add-on to a Chase current account.

47:41To tell you more, here's Joe Colchester, head of product at 11FS Pulse. Yes, I think this is a value-adding and beneficial addition to the JCK app. I don't think it's a game-changer, but what it is is it will make the app a little bit more sticky for those users who happen to subscribe to the insurance offer and then are therefore less likely to switch current accounts. People are pretty fickle here, and this will be a little bit more of a sticky element to the app, which is also signaling real kind of ambition and a broadening of its financial services beyond just a banking app, beyond just banking features.

48:25Also, it has the advantage of having a lot of trust already built within the brand. So it won't have to build that up and spend money on the marketing there. And also very simple for the users to kind of just tap to subscribe because they're already KYC'd. So yeah, I think it's a smart move and it really signals some broadening ambition that we've seen from Chase. We're pretty sure they're going to execute it well. They tend to deliver kind of with simplicity and great utility. So we'll look forward to seeing it on Pulse and you can check that out at 11fest.com forward slash Pulse. Our second story is that Starling is setting its sights on expansion in the US by licensing its banking platform.

49:10So Starling is planning to grow in the States rather than by launching consumer banking, but by licensing its banking platform, Engine, to American banks. The British bank is aiming at mid-sized American banks and credit unions, particularly those with between$5 billion and$50 billion in assets that are struggling with aging core technology platforms. Starling has set up an American presence with a New York office and a Delaware entity and is reportedly aiming to land its first American engine clients by early next year, 2027. Longer term, Starling says it's also exploring launching its own US bank, either through acquisition or by taking on a new license or charter, partly to act as a case study for the engine platform.

49:59So this is a super interesting move by Starling. Starling has always taken a slightly different approach to many of the other digital banks and has been promoting Engin by Starling for a while by hiring some serious executives in the States, people with experience previously working with mid-sized smaller and smaller U.S. banks and credit unions. Starling puts itself in a good place as a non-competitor to try and win some of those firms across to its new platform. It'll be very interesting to see whether some of the credit unions and smaller banks in the States that are sitting on older technology platforms decide to take the plunge and get themselves onto a modern technology stack.

50:44And finally, something a bit different to end the show this week. So, it's the morning after Super Bowl 60, where the Seattle Seahawks faced off against the New England Patriots. To let listeners in on the production process, you're listening to this on the Monday after the game, but we record this show on a Thursday. So you all know who won, but we don't have a clue. The game was played at Levi's Stadium in Santa Clara, California, right in the heart of Silicon Valley, one of the great fintech hubs. So it felt only right to finish today's show with a little fintech Super Bowl quiz. So we're going to let everyone have a guess on each question, and please do play along at home and let us know how you did.

51:25So the first question, to the nearest million, how much did a 30-second Super Bowl ad cost this year? Was it A, 3 million, B, 5 million, C, 8 million, or D, 12 million? Who's going to go first? I'll go first, D for me. D for 12 million. Okay, Chantal. I'm going to go C. I don't think it's quite as much as 12. And Stephanie. I'm going to go with A. I think it's actually less than people think for certain spots nowadays. Okay, well, I think I'm meant to read the answers out now, and my producer will kill me if I've got this wrong. But in fact, Chantal is right. It's answer C. It's$8 million. So well done.

52:14Okay, number two. Which crypto company ran a Super Bowl commercial featuring Curb Your Enthusiasm star and creator Larry David, who after years of being wrong might actually have got this one right? Was it A, FTX, B, crypto.com, C, Coinbase or D, Binance? Who wants to go first? Chantal, since you were spot on last time. I think I remember this one because it didn't age very well, if it's the one I'm thinking of. But I think this was the FTX. Okay, so you're going answer A. Dave, what do you think? Yeah, I'm with that. And Stephanie, from your smile of recognition, I think you maybe knew the answer.

52:58I remember this one. Yes, of course, I do remember. And it is A. It was don't miss out, wasn't it? And then it was not good. You're all spot on. It is indeed FTX. So speaking of ads, which company ran the bouncing QR code Super Bowl ad that sent everyone scrambling for their phones? Was it A, Robinhood, B, PayPal, C, Cash App, or D, Coinbase. Let's go Stephanie first. I feel like this one was Robin Hood, but I was probably eating Doritos and not paying that good of attention, which is my go-to snack during Super Bowl. Chantal? Oh, I feel like a cheat being a marketer because this is the sort of thing that I do look into quite a lot.

53:46I think this was Coinbase and I think it crashed their website as well and everybody went to go in to check it out. And Dave, we obviously have a bit of a clue there from Chantal, but what are you thinking? I remember the website crash, please. So it was Coinbase for me. Yes, Chantal is indeed spot on again. Chantal, have you got everyone right so far? I think you have, haven't you? Advertising is something I talk about too often. I don't remember the advertising, I remember it from the website crash being a techie. Question number four, our last question. This year's game is being held at Levi's Stadium in the heart of Silicon Valley.

54:21Given its location, the stadium is, of course, chock full of technology. But which of these three things is not real? A, self-pouring beer stands. B, checkout-free stadium concession stands. Or C, official merch delivered by drones. So I'm not going to go to Chantal first because she's got them all spot on. Dave, it's a bit of a techie one. What do you reckon? So it's the one that isn't real. The one that is not true, not real. 100 % has to be real self-pouring beer in the States for sure. C for make drones in the... Merch delivered by drones. Okay, Stephanie, what do you think? I actually think that the checkout-free stadium concessions is not real.

55:10Amazon tried to build an entire empire of stores around this and it failed. Even JP Morgan's lauded attempts at doing this at the F1 have not been over the top. So I think they're going to want to promote drones and like have great marketing around that. And of course, self-pouring beer. So I think it's got to be B. And Chantal, what do you think? I don't know. It's between B and C for me. I would be boring and I'd go for C because I think the health and safety on drone delivery in stands at the Super Bowl would be a nightmare. So that would be my guess for that one. So, well, the answer is indeed C, which makes Chantal our superstar, top of the class, every question right.

55:53Stephanie, I'm with you. I was like, what on earth is a checkout-free concession? How does that work? Surely that's just lots of theft. But no, apparently it's a thing. You just walk out and they bill you later. You scan a QR code as you go in. Oh, you scan a QR code. Yeah, yeah. You scan a code as you go in. That makes more sense. Okay, okay, okay. Now I'm tracking. Chantal, wow. I think I got very lucky now. I need to get on whatever you're reading. Too much of the German campaign. That was absolutely fantastic, Chantal. Well, all three of you were fantastic. I think I knew the FTX one, but I was lost on most of the others.

56:30Right. Well, thank you all so much for joining me. The show has flown by. It's been an absolute pleasure talking to all three of you. Chantal, where can people find out more about you? Where can people find out more about The Herd? Yep, so you can find me on LinkedIn, Chantal Swainston, and you can find more information on The Herd and research our speakers on the-herd.co.uk. Stephanie, where can people find out more about you and everything you're up to? You can find me, just as Chantal said, on LinkedIn. Give me a follow and hit me up in DMs if you want to chat payments or financial advice products.

57:04And Dave, where can people find out more about you and Foundry OS? Yep, you can find me, Dave Morris, on LinkedIn. or at our website, foundry-os.com. And as for me, Benjamin Ensor, you can find me on LinkedIn as well. So that wraps up today's episode. Thank you all so much for listening to today's show. If you liked what you heard, please do follow us on your favorite podcast platform of choice and do share the podcast with colleagues or friends. If you want to join the conversation, seek us out on social media, just search for 11FS or FinTech Insider, or you can email us at podcasts at 11fs.com.

57:43So thank you so much again to my three guests and thank you to all of our listeners. Goodbye.