I recently attended a seminar run by Allica Bank and a Fintech company called Fumopay to learn about modern banking. Their event was staged at the new Santander headquarters at Unity Place in Milton Keynes which is a state-of-the-art, eco-friendly, large building near the train station. So the setting was appropriately very modern.

I was already aware of Allica Bank which is a specialist challenger bank that focuses primarily on businesses which are of a size that is between micro businesses and large businesses that are being underserved by traditional high street banks. One of their unique offers is an instant access bank account paying 4.33% interest and no bank charges as long as you stay in credit with cleared funds. Admittedly they target an average bank balance of £50,000. This means that the interest rate could be reduced potentially if the balance were to remain significantly below £50,000 for long periods of time.  Nonetheless, it is a welcome proposition and refreshingly different to the major high street banks. By the way, this bank account is open to individuals too.

Additionally, you do not have to transfer your current account banking to Allica Bank to benefit from this account.

Fumopay on the other hand is not a bank but an Authorised Payment Institution regulated by the Financial Conduct Authority. They specialise in a sector called Bank by Bank transfers. It’s a low cost, secure method of payment between banks that is better for business bank to bank payments than CHAPS, BACS or Faster Payment using API under open banking. It’s cheaper, faster and more secure than paying by Paypal or Stripe for example.

Fumopay may be used by individuals too. Kevin Ludford, Fumopay’s founder, has the aspiration of Fumopay becoming a natural payment option when paying online along with the options of paying by card and by Paypal.

Other benefits for individuals include splitting bills, lending and borrowing between friends and relatives, setting up a group or a club and enabling payment from the app without having to carry a card. All very useful services.

I’ve always been a fan of challenger banks and Fintech. These two entrants into the modern banking world offer excellent services in the Fintech sector which is one of the UK’s greatest success stories. If you haven’t already used challenger banks or Fintech apps I would recommend you to do so. You know it makes sense.*

*RISK WARNING

The value of investments can fall as well as rise. You may not get back what you invest. The information contained within this article is for guidance only and does not constitute advice which should be sought before taking any action or inaction. All information is based on our current understanding of taxation, legislation, regulations and case law in the current tax year. Any levels and bases of relief from taxation are subject to change. Tax treatment is based on individual circumstances and may be subject to change in the future. The Financial Conduct Authority does not regulate tax planning, estate planning, or trusts.  This blog is based on my own observations and opinions.