NYC-based Movenbank launched its financial scoring system in public beta today to give consumers a real-time measure of their financial health, and announced that they’ve raised $2.4 million in seed funding from Anthemis Group and Raptor Ventures, among other investors. The company analyzes an individual’s relationship with their banking institutions, as well as their social influence and financial situation, and assigns them a CREDscore, which tells them how financially fit they are on any given day. The company will also launch mobile-centric banking and financial services later this year, by partnering with banking and payments partners.
Today’s CREDscore launch is a way for the company start building relationships with potential banking customers, since Movenbank’s banking fees, interest rates, and other charges will be directly tied to a customer’s CREDscore – the higher the score, the lower the fees, and the better the rates. Users can sign get a CREDscore by signing in with Facebook or Twitter, and providing optional information including their home address, Social Security Number, household income, savings, and credit score to get a more complete picture, and to improve their score. Once Movenbank launches its banking services, customers’ CREDscores will be tied to their daily banking activities and spending habits, and the company will give users feedback on how they’re spending their money, similar to Mint’s personal finance tool but tied directly to their bank accounts. Users can also increase their score by referring friends to sign up for accounts.
“Your CREDscore is a credibility score, it’s how we create a transparent relationship between you and Movenbank,” founder Brett King said in an interview. “We assess you financially in terms of financial help, and give you the tools to do that on an ongoing basis, and your CREDscore is an instance of your financial health or financial behavior.” Ultimately King said the goal is to have a central profile of each banking customer, so they can do away with application forms, and base each customer’s fees and interest rates on their profile.
King is the author of BANK 2.0, and started Movenbank in 2010 as a response to the changes he saw occurring in the retail banking industry. “I started thinking about what a bank would be like if you build it from the ground up and focused on mobile technology,” King said in an interview. “I started describing what banking would look like in five or six years time, and I realized there was nothing like that that existed yet.”
There isn’t something exactly like what Movenbank is trying to accomplish, but others are definitely looking into tying finances to social media interaction. Lenndo, a startup which raised a considerable $8 million in funding in May, is arranging loans for customers in traditionally underserved markets for those types of products based on an individual’s social network connections and reputation. There’s definitely a growing sense that online social information can be leveraged for financial use outside of just job-hunting.
The company isn’t releasing specific details on what their banking products will entail when they launch later this year, though King said they will be partnering with as-yet-unnamed third-party banking partners, and will offer traditional banking services like checking and savings accounts, as well as credit products. King is quick to note that the banking service will be mobile-centric, allowing people to make payments with a tap of their phone. “Mobile is the core of what we’re going to be doing from a day-to-day banking experience,” King said, though he said it will be supported with online banking tools.
While there are some startups tackling mobile-friendly banking and payments solutions, from banking products like Simple and digital wallets like Lemon and Google Wallet, King said the company’s largest competitors are the big banks. King said while Simple is technically a competitor, they’re both working towards the same goal of simplifying the way people do their banking. “[We] see ourselves as the new category creators,” King said. “We’re both approaching it differently, so at the end of the day Simple succeeds and Movenbank succeeds then we both succeed.”
He said while Simple is trying to attack the friction in the banking system, Movenbank is trying to give a better picture of a customer’s financial health. ”If you want to change someone’s behavior in respect to the way they spend and the way they save, you have to be a lot more tactical,” he said. “We’re building this feedback loop that helps you understand how you spend your money in real-time.”
The company already has 5,000 people already signed up to get a CREDscore, and plans to focus on NYC, Austin, and San Francisco for the banking launch later this year. King said they’ve had interest from companies in the UK, Australia and other international locations, so they’ll be looking at expanding their footprint after the U.S. launch. By combining the idea of an influencer scoring tool like Klout with a mobile banking solution, and one that rewards customers for being financially healthy, Movenbank could win over a base of customers looking to manage their budget, pay for items with their smartphone and ultimately improve their financial health. But with big banks increasingly rolling out mobile apps and payment solutions, it might be hard to convince users that an upstart financial institution is a better choice than their established counterparts.