Fintech Insider Podcast by 11:FS
00:41:56 · Wincie Wong
[00:41:56] S4: So not to not to be the boring one, but I think people when they see a banking license, they're like, oh, this company is now authorized. It's a trustworthy company we can use. What they don't necessarily think about is the capital requirements, liquidity management, you know, resolution planning, all these things that you need to answer to a regulator in order to maintain and keep your license. And those are things that would slow any company down much, less someone who's trying to operate in 34 markets or whatever it is that Revolut is currently at. So, I think that'll be interesting to see. The model that they've clearly taken is about giving competitive savings product, for example. It is a playbook that we've seen, quite often for the likes of, for example, when Uber was first starting out, it would go to city to city, to try to take over a monopoly basically of that industry with incentives, so to speak, financing cars, etcetera, to get drivers, all all of that. And and this is kind of their small version. I don't necessarily think that Revolut is looking to get everyone to switch right away. I think they... Or I I don't know. I have no idea what they're thinking in their heads, by the way, but this is my conjecture. But what I think they're probably planning to do, which is similar to what happened, I think, in The UK, is to create an alternative, as James talked about, a competitor in a landscape that didn't have as much. And that hopefully people use it as a secondary account and maybe move to them in the next decade or so or over a long period of time. It takes a lot to push someone to switch. I mean, in The UK, have a switching scheme. And what it has proven is just how sticky people just are. People just cannot be deal or cannot be bothered with the paperwork required to switch from one provider to another, just because of the amount of forms and things that you need to do or fill in. So I think it's very smart. I think the world is becoming more global as everyone is more connected throughout the world. I certainly find myself paying for things in many different countries on a daily basis now. And having something like a global bank account that is truly a global bank account is extremely interesting and exciting because there aren't any of the major banks who have quite done that really well across the board.
00:44:36 · Wincie Wong, Kate Moody
Even, for example, HSBC, which marketed itself as the world's bank for a very long time, a couple of years ago, just closed up all their operations for retail banking in The US. So that just goes to show how hard a business it can be in different regions. So it'll be very, very interesting to see how Revolut continues as they continue to expand, not just in New Zealand, but other markets as well. [00:45:04] S0: Clive and Wincie, give you the final word on on this one. Mean, certainly from my perspective, it's just, yes, it's amazing for New Zealand, but it's like New Zealand, in addition to all of the other markets that they've got the
00:45:16 · Clive Summerfield
[00:45:16] S3: license in this year. Mean, what's your take? So yeah, they've industrialized the license application, haven't they? They've basically made that into their central business process and hoovering up all the markets that they can apply to and get into. And I think you're right, it's becoming a truly global bank, an online digital bank that's a global bank. And I think it's a very interesting move. There's a lot of overhead associated with it because as you probably appreciate, the regulations, reporting, the compliance, identity verification is all quite different in these various jurisdictions, but, you know, full marks to them for taking on a basically a global expansion strategy. And it's a... You know, I've I've lived in Australia for forty years, so I know what the Aussie banks are like. It's a good job. You know, they need a bit of competition over there and good on them for driving that competitive landscape. I think Commonwealth Bank, ANZ, NAB, and, Westpac have have added to, you know, far too long to alter themselves. And so it's good to see, particularly in New Zealand, which actually has a long heritage of adopting new technologies early. I mean, I have a very fond fond place for New Zealand because, in my previous company, its government, IRD, the New Zealand Tax Office, deployed, voice biometrics and got pretty much 80% of the adult population of New Zealand evolved in two years. On a per capita basis, it's orders of magnitude beyond what anyone else in the world has done. So they've... Yeah, best of luck to them is my, my comment to all of this,
00:47:19 · Kate Moody
[00:47:19] S0: and, well done. Well, kudos to Revolut, and yeah, just sounds like a general, general loving for New Zealand, full stop. So, we'll we'll keep our eyes peeled, you know, how what they actually do bring to market. But, yeah, to Wincie's point as well, like, how they keep on top of all of the stuff that happens behind the scenes to not just win the license but but keep the license as well. On that note, we're just gonna take a quick pause here. We're back shortly. Okay. Now for a quick look at a story that we don't have time to cover in full. This one's taken from FS Tech, and that is HSBC to establish Hong Kong AI Institute. HSBC has announced plans to establish a new global AI and emerging technology institute in Hong Kong as it looks to accelerate the adoption of emerging technologies across the bank. Set to open in early twenty twenty seven, the institute will focus on areas including AI powered fraud prevention, engineering efficiency, employee upskilling, and AI safety alongside technologies such as blockchain and post quantum cryptography. HSBC is partnering with the Hong Kong University of Science and Technology on the initiative bringing academic research and industry expertise together. This will be the bank's second dedicated AI hub following the launch of its global AI center of excellence in Singapore earlier this year. The announcement comes as HSBC continues to expand its AI strategy, having appointed its first chief AI officer in March, whilst also acknowledging that greater adoption of AI could lead to job losses. Obviously, like an intro, just by chance, this story obviously overlaps with quite a few of the other things we've touched on the show already, know, Wincie already alluded to some of the amazing developments we're seeing in AI in China. I think probably not a coincidence that they've moved Hong Kong, obviously in their statement they did cite, you know, the strong connections across the Chinese Mainland as one of the key drivers for locating this second institute here. We've also touched on the need for global banks and maybe HSBC maybe changing its interpretation of what it means to be to be a global bank. So, yeah, really interesting to see them taking this initiative, obviously getting ahead and staying ahead in this space, in the AI space is absolutely the name of the game as we look ahead to 2027.
00:49:28 · Kate Moody
So, yeah, watch this one to see if HSBC's investments actually pay off in terms of, you know, AI use cases they can deploy across the bank, but also more importantly from where I'm sat, know, directly to customers as well. Okay. Onto our and finally story. So wherever you're selling your old clothes on Vinted, walking the neighbor's dog, or running a secret empty empire, there's some good news for Britain's side hustlers. Although if you're doing the same thing in Belgium, you might want to check your paperwork. This story comes from The Guardian and that set out that UK side hustle tax free allowance is set to rise to £3,000 next year. The UK government has announced plans to increase the tax free trading allowance from £1,000 to £3,000 from April 2027, giving a boost to people earning extra income through side hustles. The change announced in the budget could benefit up to 1,400,000 people, including those making money from activities such as tutoring, dog walking, and selling products online. Around 400,000 people are expected to see their tax bills fall, saving an average of £380, while approximately 100,000 will no longer need to report their trading income to HMRC. According to HMRC figures, 2,600,000 people earned money selling goods through platforms including eBay, Vinted, and Etsy last year compared with just 450,000 in 2024. But while The UK is making life easier for side hustlers, Belgium is taking a different approach. Belgian authorities have issued 98 fines this year to people earning undeclared income through platforms such as Instagram and Vinted without registering as self employed. James, coming to you first on this one. Are you a are you a side hustler? Is this good news for you?
00:51:03 · James A. Brown
[00:51:03] S5: Interesting, I was thinking about this actually earlier on, Not so much now, I must admit, as I have been historically. But I do have a garage full of items that have yet to be posted on to Vinted, I have to say. But we had friends actually up at the weekend and he shared with me actually a couple of websites that he purchases from and it sort of got me thinking that there's items on there like, you know, shoe, I mean, all sorts of different things that you are able to pick up at the fraction of what you would potentially expect to pay in the high street shop. So I think if I look at it with my current role, lens on, and the members that we deal with, I think this is a fabulous initiative to give people the opportunity to actually get more money back into the pocket where, you know, cost of living crisis, energy pricing, etcetera, etcetera. And I know there was some stuff in the budget that will help with that, but I think you'll start to see more and more people actually having these little sort of side hustles in order to sort of create that extra income that allows them to do the things that they want to do. And you know, without getting too dramatic about it, for some families actually just, know, as simple as actually putting food on the table or actually allowing their kids to sort of, you know, go to school, wear a pair of shoes. And the reason why I referenced that, you know, back to New Zealand, a lot of kids used to go to school with no shoes and nothing in the lunchbox. So I think it's a good move from the government. And I think, yeah, you'll start to be down in the pub speaking to people and overhearing conversations and they'll be like, oh, that sounds interesting, I'm gonna go and have a look at that. Because there's money everywhere, it's just about how you, I suppose, focus your time to actually execute on it.