Avant Money (Bankinter) to enter Irish banking market

Great to hear about more competition.

I use Revolut a lot, but have reverted to irish bank.

I used Revolut for fx initially, but eventually full banking with intention to close my irish "proper" account, the established banks expedited my decision when they killed free banking while having a mortgage rate 1000s of euros a year higher than European peers.

i have only had a good experience with Revolut. In recent months though I have reverted - as cash built up I was in parallel reading more and more about people who got scammed and got no support refunds. A few years ago with my irish bank they immediately refunded me when an issue arose, maybe they wouldn't these days but I'd kick myself if I lost money in Revolut after ignoring the noise.
 
Freelance said:
But given the track record of banking in general and the long list of new entrants who rapidly became new exits it appears to be a tall order, especially as it needs to be profitable. I'll wish Avant the best of luck, but won't be holding my breath.
Click to expand...

I think this is the nub of the issue. A lot of people have seen this before and will fear it will end the same way. They'll take some convincing to move banks (again).

Avant/Bankinter will be aware of this too. That's why I imagine they'll tread lightly and are passporting in rather than establishing a full standalone banking operation.

It's a tough ask but a mix of local brand recognition and the ability to leverage off their existing operations in Spain is probably the best hope we have of getting something new to work outside of the fintechs.
 
Apart from handling cheques what do you think the concern is for Irish people moving away from "proper" banks?

I'm lucky enough to have never needed revolut customer support but have relied on n26 customer support several times over the last few years and in my limited experience it was by far better than any other bank I have dealt with.

I still have an Irish bank account which I opened due to IBAN discrimination before revolut offered Irish IBANs, but I am wondering why I even need it any more.

The only other thing I remember not being supported was joint accounts but now n26 is rolling those out as well.
 
I think the main concerns are fraud or your account being locked down and a being stuck in a continuous loop of chatbots.

I was using my Revolut account a lot and was subjected to enhanced due diligence around a year ago but that’s the only peculiar experience I’ve had. I’d feel comfortable using Bankinter, but my strong suspicion is that Charlie Weston is overselling this and that they’won’t come in at massively attractive rates.
 
someCitizen said:
Apart from handling cheques what do you think the concern is for Irish people moving away from "proper" banks?

I'm lucky enough to have never needed revolut customer support but have relied on n26 customer support several times over the last few years and in my limited experience it was by far better than any other bank I have dealt with.

I still have an Irish bank account which I opened due to IBAN discrimination before revolut offered Irish IBANs, but I am wondering why I even need it any more.

The only other thing I remember not being supported was joint accounts but now n26 is rolling those out as well.
Click to expand...
Never said it was rationale but fear of the unknown and/or history of bank closures repeating itself will stop many from switching. There are plenty of posts in the deposit forum if people complaining about low deposit rates in Irish banks but won't go near the better rates in foreign banks. I can see the same thing happening here, never underestimate inertia.

To be clear I switched to N26 too and am perfectly happy with what they offer. Then again I'm the Liz Taylor of current account, after being with NIB/Danske, Halifax, Ulster (X2) and KBC. So with their current account arrives I might give Avant the kiss of death too.
 
Well, they could strike a deal with AnPost (like AIB/BOI) and allow cash/cheque lodgment via their network.

Coupled with a contact center (and Avant Card Center is one of the better ones I had to deal with) and the brand trust (I mean people trust them with their credit card, loans and mortgages) they might get some customers (especially existing card/loan) if the terms are good.

Plus unlike Revolut/N26 which started as apps offering other vendors and then gradually moved to their own products this is an experienced bank offering products in another country for a long while.
 
www.irishtimes.com

PTSB most exposed Irish lender to competitive threat from Spanish move into market

Bankinter’s Avant Money is looking to expand its product and service offerings as it becomes a bank branch, beginning initially with deposits
www.irishtimes.com www.irishtimes.com

Interesting article by Joe Brennan in today’s Irish Times (firewalled) covering Avant’s entry and putting it in context. Also outlining potential impact on PTSB and som interesting observations on PTSB’s current status and prospects.
 
someCitizen said:
Apart from handling cheques what do you think the concern is for Irish people moving away from "proper" banks?

I'm lucky enough to have never needed revolut customer support but have relied on n26 customer support several times over the last few years and in my limited experience it was by far better than any other bank I have dealt with.

I still have an Irish bank account which I opened due to IBAN discrimination before revolut offered Irish IBANs, but I am wondering why I even need it any more.

The only other thing I remember not being supported was joint accounts but now n26 is rolling those out as well.
Click to expand...
I don't care about cheques. For me, I have heard too many horror stories of people's accounts getting frozen. It is probably still pretty rare with revolut but seems to be more common than with a traditional bank. Over the years I have had large deposits or other transactions that might be flagged as suspicious and the traditional bank just rings you about it and asks a few questions. With Revolut and possibly other fintech banks they seem a lot more likely to freeze the account. Getting back into the account seems to be very difficult as well.

Also, a few years ago I got a new phone. When trying to log into the Monese app, it locked my account. It's possible I did something wrong with the secuity checks. I thought I followed exactly what they were asking me to do but maybe I did something wrong. It took months to get back into the account. Any emails I sent never got a reply.

All the above is a pain when you only have a few quid in the account but I don't want that happening to my main account where my wages go into and my rent is being paid from.
 
Not heard of any accounts been frozen- and that's annoying but at least your money is still there.

Main issue is frequent news reports of 20-30-40,000 euro savings been drained in a scam and e-banks blaming the customer for being lax with pin or other excuse for not assisting.

I like Revolut product (and pay premium sub) so this bothered me to the point of trying to write to their execs to sort out their approach or watch large numbers revert back to established banks as they catch up on their IT.

www.irishtimes.com

‘Sorry you lost the money’: Couple loses thousands of euro of wedding savings in Revolut ‘ordeal’

Pricewatch: The transactions were in increasing amounts from $50 to $2000 before Revolut ‘finally froze the card at the $2500′
www.irishtimes.com www.irishtimes.com

Scammers took £20,000 of my wedding savings but Revolut won’t pay me back | Scams | The Guardian

I’m young and clued-up but even I was the victim of a sophisticated con – and now the bank says I can’t have a refund
amp.theguardian.com amp.theguardian.com
 
Last edited:
"Eventually, with plausible explanations, they persuaded me to move £20,000 from my Nationwide to my Revolut account, and then to another newly opened account in my name."

This sounds bizarre. I feel sorry for her but some people shouldn't be allowed to have an online account without supervision.
 
Agree Tom, I think some of the other stories are genuine bad luck though? Some of the scams are sophisticated now, and despite being "up to date" I wouldn't bet on myself "never" getting scammed
 
EBS is the hidden gem in the current account market. Responsive call centre staffed by humans based in Ireland, no fees, nationwide branch network, and an online offering that is so antiquated that it doesn't lend itself to online scams. Think about it, you never hear of an EBS customer being scammed.
 
presidenttttt said:
Agree Tom, I think some of the other stories are genuine bad luck though? Some of the scams are sophisticated now, and despite being "up to date" I wouldn't bet on myself "never" getting scammed.
Click to expand...
The psychology is clever (panic, then empathetic agent coming to the rescue). Banks could eliminate a lot of this by all agreeing to never contact customers by phone or text and by running an ad campaign to remind them of this.
 
Banking fundamentally is a low cost loan producer wins business…and unfortunately the pillar banks for now are the unassailable low cost producer of any type of loan in the Irish market....simply by virtue of their deposit funding costs.

I suspect Avant gets some diversity being here in the Irish market…picks its spot to collect higher RoE relative to the risk opportunities than might exist in its home market…but when a competitor, like Avant, comes in and has to offer 2% on deposit accounts what they are signposting is that they are unlikely to be true competitor at scale (in the short run) on the lending side which is disappointing.

Given that 2% deposit rate they are basically giving up 200bps of cost to their main competitor...the sad reality is that AIB/BOI have a duopoly position in low cost deposit funding….if you factor in their quarterly fees….the two pillar banks have something close to a negative cost of deposit funds (most definitely when you add in current ECB rates on excess deposits)....more competition is good but when you look at AIB/BOI's funding cost its desperately hard for a competitor to enter and compete effectively on a mainstream mortgage product at a scale anywhere close to what AIB/BOI does.....to the extent that AIB/BOI ever got greedy (by expanding their spreads) they might create a recipe for a competitor to enter but I just don't see them being that dumb. The recent uptick in European mortgage rates that transmitted in a very minor way to underlying Irish mortgage rates showed the pricing strategy of the Irish banks. They will always price at the edge of where it becomes uneconomic for a competitor to enter.

The last wave of competition that came into the Irish mortgage market here from overseas lenders leading up to the GFC was what I would characterize as uneconomic lending......they barely upset or unseated the deposit franchise of the Irish banks.....how they competed was wholesale funding but the real dirty secret was that the foreign banks, mainly UK, were willing to take ever smaller and smaller spreads on loans....in turn lowering and lowering their return on assets for their lending book which they solved for by increasing their turns of leverage to get something approaching a reasonable RoE (which even then the northern rocks of the world drove down to ridiculously low levels too). The original sin was the regulators let them do that, the second sin was that the Irish banks followed them into the mud. Anything like that is unlikely to happen again. Regulation has cemented the duopoly position of AIB & BOI.

I say all this to highlight the fact that until you see a mortgage lender enter the market with a credible plan to twin that lending with a stable deposit book that in time might scale cost effectively to compete with AIB/BOI or alternatively with access to a low cost sticky foreign deposit franchise comparable to AIB/BOI's (which doesn't exist anywhere in Europe IMO)......competition, at scale, in mortgage lending here is unlikely to appear.
 
letitroll said:
Banking fundamentally is a low cost loan producer wins business…and unfortunately the pillar banks for now are the unassailable low cost producer of any type of loan in the Irish market....simply by virtue of their deposit funding costs.

I suspect Avant gets some diversity being here in the Irish market…picks its spot to collect higher RoE relative to the risk opportunities than might exist in its home market…but when a competitor, like Avant, comes in and has to offer 2% on deposit accounts what they are signposting is that they are unlikely to be true competitor at scale (in the short run) on the lending side which is disappointing.

Given that 2% deposit rate they are basically giving up 200bps of cost to their main competitor...the sad reality is that AIB/BOI have a duopoly position in low cost deposit funding….if you factor in their quarterly fees….the two pillar banks have something close to a negative cost of deposit funds (most definitely when you add in current ECB rates on excess deposits)....more competition is good but when you look at AIB/BOI's funding cost its desperately hard for a competitor to enter and compete effectively on a mainstream mortgage product at a scale anywhere close to what AIB/BOI does.....to the extent that AIB/BOI ever got greedy (by expanding their spreads) they might create a recipe for a competitor to enter but I just don't see them being that dumb. The recent uptick in European mortgage rates that transmitted in a very minor way to underlying Irish mortgage rates showed the pricing strategy of the Irish banks. They will always price at the edge of where it becomes uneconomic for a competitor to enter.

The last wave of competition that came into the Irish mortgage market here from overseas lenders leading up to the GFC was what I would characterize as uneconomic lending......they barely upset or unseated the deposit franchise of the Irish banks.....how they competed was wholesale funding but the real dirty secret was that the foreign banks, mainly UK, were willing to take ever smaller and smaller spreads on loans....in turn lowering and lowering their return on assets for their lending book which they solved for by increasing their turns of leverage to get something approaching a reasonable RoE (which even then the northern rocks of the world drove down to ridiculously low levels too). The original sin was the regulators let them do that, the second sin was that the Irish banks followed them into the mud. Anything like that is unlikely to happen again. Regulation has cemented the duopoly position of AIB & BOI.

I say all this to highlight the fact that until you see a mortgage lender enter the market with a credible plan to twin that lending with a stable deposit book that in time might scale cost effectively to compete with AIB/BOI or alternatively with access to a low cost sticky foreign deposit franchise comparable to AIB/BOI's (which doesn't exist anywhere in Europe IMO)......competition, at scale, in mortgage lending here is unlikely to appear.
Click to expand...
Avant have been selling mortgages in Ireland for a few years now. I'm quite happy with my 1.95% fixed for 7 years.
 
Fortune said:
Avant have been selling mortgages in Ireland for a few years now. I'm quite happy with my 1.95% fixed for 7 years.
Click to expand...

Not at a scale that would give AIB or BOI a seconds pause (yet).....Avant picks off mortgages around the edges lots of switchers and those looking to fix for extended periods.....I'm glad they are around and I'm especially enamoured with some of their 30yr fixed rate products which at the height of 2020/2021 were IMO just one of the great slam dunks in life to lock down....but the last figures I saw which was from the height of the switching craze in 2022 saw them max out at something like a 10% market share....which is good but they are not driving the bus in terms of pricing in the Irish market IMO....their pricing strategy appears rather to be to ever so slightly track and undercut the AIB/BOI rates & collect those price sensitive customers (or to go for those interested in extended firm terms commitments)....in this sense I think of Avant as a price taker
 
Letitrol you loading your cash into BOI & AIB shares? Its a great pitch if someone was looking to buy some shares is the situation really that good for the core irish banks, I always understood the inability to get the asset back without war and peace for years was a major turn off for mortgage competitors ?
 
You must log in or register to reply here.
Back
Top