Week Four: The best bank you’ve never heard of, and the self-inflicted Uber tax (dozens and Moneybox)
Another week, another bank, and this time it’s the turn of dozens. I have fan-girled dozens quite a bit in previous weeks, so I apologise if I am repeating myself, but for first time readers of the blog, dozens are a super new neo-bank with a strong focus on helping their members save. I joined the waiting list back in December, and to my glee was one of the first people accepted off in early March. My card arrived just a few days later, giving me full access to the app and it’s features once I had put some cash into it.
And I have to day, it’s bloody good.
What I loved about dozens — Savings, savings and more savings
The whole marketing spiel around dozens is focused on how, especially over the last 10 years, low interest rates have caused havoc for those that have cash savings, with returns often growing slower than the rate of inflation. This has led to a swathe of people just like me both without any significant savings, nor the desire to start saving. Dozens wants to change this, offering a number of cool features aiming to help their users spend less, and tuck more of their hard earned cash away.
The app feels and looks great, and the UI is designed to push users on a journey from spenders, to savers, to investors. For spenders (like myself) they aim to help them understand and track their money, similar to the other challenger-banks, in order to free up some money to save. They have some interesting extra features compared to the other banks I have reviewed, like the ability to categorise the ‘happiness’ rating of each purchase. By frequently categorising how happy each purchase made you, from grabbing a Pret in between meetings, to your daily commute, to evening drinks, they aim to show you how much of your spending is on things you don’t enjoy, and recommend you aim to change that first. Smart.
The UI around the spending and tracking areas is beautiful, with great breakdowns for daily, weekly, and monthly spending, as well as heatmaps, geo-location maps for your spending, and a quite powerful budgeting tool. Whilst it was fiddly to set up, and quite buggy in places, once I had got to grips with the budgeting it did a good job of keeping me on track with how much I had left to spend for that week. Early days, but promising signs.
Did I mention saving? — The 5% interest bond
The reason I was most excited about dozens was their widely advertised 5% interest bond. I recommend reading their article on their website here if you want to get nerdy and really understand the details, but the short version is they are offering a 12 month 5% interest bond, with a minimum of £100 starting capital. The interest gets paid monthly, and if you want to sell the bond and get your money back, you can do so and retain the interest you have earned. It’s awesome. I’ve applied for my first bond, and will let you know how it goes in future weeks.
However, this isn’t even the coolest savings feature dozens has up their sleeve. They use ‘If This Then That’ (IFTTT), a nifty bit of software that allows you to link apps to set creative rules for savings, all within the dozens app. For example, I set an ‘Uber tax’ on my account— every time I book an Uber on my phone, dozens puts £5 into a savings account for me. Likewise, every time it rains in London, dozens puts a few pounds into my holiday savings. I stopped short of setting up money to come out of my account for every time Tottenham score (mainly because it would drain my account am I right) but the options are pretty endless. I LOVED this feature, it made saving regular and fun, as well as helping curb my bad habits, like taking too many Ubers. I found out from a few friends that Monzo has this feature too, but not within the Monzo app itself, so I’m giving dozens the cred for this one.
Side note: I recently found out I took 87 Uber’s in 2018 thanks to Cleo. More on that in a few weeks…
Investing with dozens
The last area of the app is the invest section, and this is arguably the most exciting. The team at dozens is creating a number of portfolios for their users to invest in, targeting at those with a spare £1000 or more lying around.
What truly excited me about this offering was how unique the portfolios on offer were. They have curated investment strategies for everyone: those wanting environmentally or socially responsible investments, to emerging markets like Brazil and China, or new high growth areas like Cyber Security and Robotics, their aim is to help you grow your cash whilst making the world a better place. I haven’t seen this in any other app, and think its a huge differentiator.
(Full disclosure: this part of the app is still very much in alpha and was not fully open to me, but I read some further reviews online and on the dozens forums. Also I don’t have a spare grand kicking around…)
Where dozens falls down
If you are coming to dozens from a ‘legacy’ bank, safe to say you will be very impressed with the current features on offer. However, if you are coming from one of the challenger banks, you will find its weaknesses quickly. Starling and the others have nearly a 4 year head start on dozens, and it shows. Authentication is okay, but sometimes glitches out, forcing you to request a log-in code by text. Notifications work, but aren’t detailed, simply saying ‘card transaction successful’, unlike the other banks which provide merchant, value and total daily spend details. Sending and receiving cash can only be done via the traditional account number and sort code, and whilst they do provide the options to share these, you can’t send payment links like the other banks. And so far, no apple pay. Big holes in the offering.
In my opinion these features are pretty critical to having a mobile bank, and really make the Starling/Monzo experience a painless one. However, I think you have to give dozens the benefit of the doubt given how early in their journey they are. I think a lot rests on how quickly dozens can iterate fast enough over the next six to twelve months to bring themselves up to feature parity with the other challenger banks. They seem to be banking (🥁) a lot on their ability to differentiate themselves through their focus on savings, and depending on how they shape up over the coming year, they could certainly begin to challenge the other challengers.
Why I love Moneybox
Moneybox is an app that has been around for a while, and an app I have been using since last June. It’s premise is simple — it connects to most of the major banks (and even some of the challenger banks) and provides the ‘roundup’ service I have mentioned so many times in previous review. I hear you ask however, “Alex, if Monzo/Revolut/Starling/dozens allow me to roundup within their apps, why do I need a separate app to do this?”
An excellent question. Someone’s obviously been paying attention.
Moneybox’s value (and potential downfall) lies in the fact that once you have rounded up your pennies with them, they take them and invest them for you. When setting up the app, you are asked to chose a risk level, from ‘Cautious’, which invests primarily in government and corporate bonds, to ‘Adventurous’, which invests mostly in stocks and shares. This makes Moneybox great for those looking to tuck money away in the long term, looking to grow their cash over 3–5 years.
However, I was naively using Moneybox to save up for a holiday. After tucking away my pennies, I had to begin a painful process of extracting my cash, because first the Moneybox team had to sell the assets I had invested in, and then return the money to me, which took over a month. I love the roundup feature however - without really realising it, over the last nine months I have saved up nearly £700, more than enough for some flights somewhere fun.
If you have a traditional bank and are looking to dip your toes in the fintech world for the first time, or are looking to open an ISA to start saving properly, I think Moneybox is a great place to start. If short term saving is your thing, maybe using roundups within Starling Spaces or Monzo Pots is better suited.
Freetrade – coming soon
I have been promising to review Freetrade for a few weeks now, but I’ve realised that these posts are getting kinda…long, and the last thing I want to do is bore y’all. Freetrade is awesome, and still operating a waitlist, so jump on while you can, but a full write up is coming soon. I’m also heading to their meetup on the 28th March in London, so may have some cool news to report after that. Stay tuned.
Next week: Monese and GLINT
Next week I’m checking out Monese, a small but punchy challenger bank with an adorable UI and some really cool features. I’m also going to talk about Glint, a fintech firm that converts its users balance into actual, physical GOLD. That’s right everyone, I’m gonna buy myself some gold next week.
As always, thanks for reading.
