“There are two types of competition for us at Loot: the banks and the money management apps,” Loot founder Ollie Purdue tells me. The U.K. startup, founded in 2014 while now 24 year old Purdue was finishing up university, offers a digital-only current account aimed at students and millennials. It comes with a MasterCard and mobile app, with a particular focus on spending insights and real-time budgeting.

“Right now, we have a current account which works like a traditional bank account, but on top of that we have built loads of tech to help you manage your money,” he says. “This includes things like live-budgeting so you know exactly how much you can spend, free FX abroad, or our goals feature designed to help you put money aside and save. We try to focus our users on how much they can spend today, which is why our budgeting circle is the biggest thing you see when you open the app”.

Notably, like a number of competitors, such as Monese, Loot doesn’t have a banking license and has no plans to apply for one but instead operates under an electronic money licence through a partnership with FCA regulated Wirecard. But for all intents and purposes the product serves all current account needs and can operate as a fully-fledged bank replacement. This includes debit card, account number and sort code, and bank transfers with faster payments.

“The banks have significant market share, but struggle with helping people understand their money, and, in my opinion, they also struggle with tech and branding,” says Purdue, noting that since he started Loot, Natwest’s app “hasn’t materially changed in any way I would notice it”. That’s too slow, he says, and that although the new fintech banks are much better at this, “none of us are at scale yet”.

Meanwhile, Purdue reckons money management apps are approaching user problems from a different angle. However, as they don’t “own” the current account, it’s hard to be proactive on behalf of the user, specifically in regards to helping them move money around (although that will arguably change next year as new Open Banking legalisation comes into force). “Also, with a money management app you are still stuck with having to choose a bank! At Loot we are trying to merge the two so we can be the only financial account you need”.

Ever since the original MVP was launched in 2015, Loot has proved one of the quickest ways to access a current account and, as a result, has resonated with international students. “As we were building it, we realised the account would be really useful for international students who struggle to open a bank account when they arrive in the U.K. Although it was basic, it solved the issue of getting an account, which is their top priority,” Purdue says.

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