Tag: Now Money app

What it’s like launching a Fintech startup in the UAE

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Ian Dillon

It took us 4 years – but we launched our Fintech startup NOW Money in May this year, and the reception so far has made it all worth it.

We started NOW Money in the summer of 2015. Back then we didn’t yet know how little we knew about what we were trying to do and how to do it, but we did know exactly the problem we wanted to solve.

Bank accounts are often accessible only to those that earn over AED5,000 per month. In the GCC, there are 25 million low-income workers that earn less than this. This means no bank accounts, no online payments, no ability to send money home using cheap online providers that almost everyone from Europe is used to. Our goal was to provide the best account in the GCC, with these excluded workers our customers.

My co-founder, Katharine, and I had seen the success of the new mobile only ‘challenger banks’ that had started in the UK – the likes of Monzo, Startling and Revolut. Customers loved them and had a passion for them that had never been seen for banks and financial services companies before. We wanted to do the same thing first in the UAE and then across the GCC.

These days, ‘startup’ and ‘Fintech’ are the new big buzzwords. Billions are invested into Fintech startups annually; many people have entrepreneurial ambitions to start or work at a startup and a number of corporates have strategies to partner with or support entrepreneurs and startups. However in 2015 mindsets were completely different. Almost no one understood why we’d left well paid jobs and the corporate ladder. We were laughed out of meetings, often told that what we were trying to do was impossible. We couldn’t get legal support, couldn’t get a bank account ourselves and were lightyears away from being able to raise funding. We made life hard for ourselves by being focused on remaining independent, creating our own technology and providing the best customer service possible from day 1, and the delays were demoralising and at times we wondered if we’d ever get to launch.

However with persistence we broke down each of the barriers – and 4 years and a lot more grey hairs later we launched in May this year. We had to overcome so many challenges in those 4 years to launch, the most time consuming being banking (try getting an account, let alone a banking partnership as a Fintech startup in the UAE) and regulatory issues.

These barriers took so long to break down that we had got used to running the company in a cycle of break down a barrier, move to the next problem, raise funding to keep the lights on, repeat. So when we had finally received the last of the approvals required earlier this year and launched, it all felt quite surreal.

For the first time, and after years of planning, we had customers. This meant the problems we had to solve quickly changed from dealing with bankers, regulators and investors, to issues such as customers losing their cards, remittances being delayed, customers not having the right documentation to open an account, etc. We realised that even with the most comprehensive planning, you cannot prepare for and have no idea what will happen until you launch! We’ve learned to be very nimble and adaptable, aided by our incredible in-house team of tech developers that are all with us in Dubai and everyone in the company (and this means everyone!) is on the ground with customers at least once a fortnight. We believe it is this connection with our customers and ability to innovate quickly to optimise ourselves around their needs which sets us apart from the competition.

The satisfaction and validation of our mission that we’ve seen since launching has been immense. Numbers of customers continue to grow strongly – we’ll accept over 2,000 new customers in September alone – but the most pleasing thing has been the reception from customers. 

With an account like NOW Money, it would be easy for our customers to use the MasterCard we provide to take their salary out at an ATM and continue to spend this cash in the same way in which they did before, and at first they did. In our first month in May just 12% of our customers used the account for anything other than cash withdrawal. However since then the engagement has exploded as customers discover the range of services available to them in the app – services which save them significant amounts of time and money, which ultimately ends up in the hands of their families back home. And as word of mouth spreads amongst our customers, the change in behaviour has happened rapidly. Last month almost 60% of our customers made an in-app transaction or significant card spend in-store, and this ratio is continuing to trend strongly upwards. More importantly, the direct feedback we collect daily has been overwhelmingly positive, with customers used to being ignored often surprised that a company would go to such lengths to provide a great solution for them.

Also pleasing is to see the appreciation of their employers. Employers in the UAE often get a bad rap for the way they treat staff – but those we’ve worked with really do care and on a couple of occasions I have even been called directly to thank us for providing a service their employees like so much and that provides them with financial independence they’ve not experienced before. This has led to employers referring us to other corporates in their networks – the very best form of sales lead.

We’ve just closed a funding round, led by the UK’s leading Fintech Venture Capital investor. We are working hard on adding additional exchange and other partners to our network to give our customers more choices, preparing for upcoming launches to Saudi and Bahrain, and working on an offering for SMEs in the UAE. But one goal that will remain our number one priority – the same mission that got Katharine and I through the tough times for 4 years – is providing the best account in the GCC for our customers. We don’t believe that income, nationality or any other factor should stop anyone from having the best experience and loving their account, and so far the response we’ve seen from our customers is proving that it isn’t.

We’re changing the way financial services operates in the UAE, and operate in a very transparent and openly collaborative manner. If you’d like to learn more or reach out with any opportunities, please reach out to me on LinkedIn, Twitter or comment on this post.

Hope in the city of neon lights

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Tall buildings, glittering hotels and a luxury lifestyle are all things commonly associated with Dubai. However, there is another side to this jewel in the desert. Many people forget about the blue collar workers who build our city and make it turn. They’re an integral part of Dubai and the UAE but all too often they get ignored.

I’ve lived in Dubai for ten years now and I still only know a relatively small amount about blue collar workers. A few weeks ago I decided to change this and had a chat with a man near where I live. At first he was hesitant to reveal too much to me but after I explained why I was interested in his life he was more than happy to talk and share his experiences with me.

His name was Bilal, and he told me about his daily routine. He wakes up at 5am every day as he has to get a lift from his accommodation, near the Iranian Hospital, to his work which is in JAFZA. He has to be at work at 8am and this is the only way he can make it on time. Bilal starts his duties as a removals assistant as soon as he arrives at work. He can be sent anywhere, his company covers all of Dubai and Sharjah, and once he arrives at a client’s location for the day he will be moving and packing heavy items. The work is physically demanding and very hard in the summer when the temperatures are so high. Bilal explained that he often gets sick, especially during the summer and he believes this is because of heat related issues.

I asked Bilal if he had a bank account in order to receive his salary. He told me that he’s been in Dubai for nearly two years but has never had an account as his salary is too low to open one (in the UAE, most banks require a minimum salary of AED 3,000 per month to open an account). He also said that banks require a lot of documents which he struggles to provide. I wondered how he gets paid if he has no bank account and Bilal explained that his boss transfers his salary to an exchange house for him to collect. The exchange house is located in Deira Naif which is a good distance from where he lives so he has to spend more money travelling to collect his salary. The exchange house also deducts AED 5 for the service. Whilst this might seem like a small amount, this is the cost of food for one day for Bilal so it’s significant to him.

Bilal tells me the reason he puts up with this is because of his family in Pakistan. He wants to support them and provide them with a positive future.

Bilal is just one of many blue collar workers facing these issues in Dubai, similar to those in any big city. However, it’s time to make a change. Here at NOW Money, we believe that everyone should be able to access financial services, regardless of how little they earn. Financial inclusion benefits society as a whole not just those at the bottom end.  We aim to make money transfers as easy as ‘liking’ a picture on your favourite social media account, and this is one click that could actually change someone’s life.

How to save money on a limited budget

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The start of a new year is a great time to review your finances. Living and working in Dubai means many people have more disposable income than they did in their home countries and if you’re disciplined, this can translate into a healthy savings pot. However, it’s easy to lose track and end up saving nothing at all. Lots of people begin with good intentions, only to find themselves in a muddle halfway through the year. Follow our savings tips below and start on the path to financial stability.

Budget

Break down all your outgoings line by line. Rent/housing, bills, food, transportation, family support etc. Write an amount next to each one and then add it up. Hopefully this is less than your total salary. From what’s left, work out reasonably what you can afford to save.

Track expenses

Those using the NOW Money app can easily track all of their spending in one place as all transactions are recorded. However, for cash spending you can just use pencil and paper. Jot down every time you make a purchase. If you can see what you’re spending, it’s easier to see where you can make savings. Take out or restaurant food is a lot more expensive than buying food and cooking at home. Similarly, taking taxis can deplete your cash reserves a lot faster than the metro.

Set money aside

When you’ve worked out your budget and how much you can save, plan to set this amount aside each month. This should ideally be a minimum of 10% of your salary. The phrase ‘pay yourself first’ is a good one to remember. Essentially it means paying your savings first and then spending what’s leftover, rather than saving what’s left after you’ve finished spending.

Decide where to save

It’s important to work out where you will deposit your nest egg. Cash is not the best option as it’s too easy to dip into if you’re running a bit short one month. Also, if you live in shared accommodation, cash is a temptation to thieves. A good place to store your money is in a UAE savings account, however there are usually minimum salary requirements, which can exclude a lot of low-income people.  Another option would be to open a savings account in your home country although beware, some of your savings will be lost in foreign exchange fees. Those using NOW Money can keep their savings secure in their UAE-based account, which has no minimum salary requirements.

If you earn over AED 1,000 a month, you can also invest in UAE Bonds from as little as AED 100. Whilst you won’t earn interest, you will be eligible for cash prizes of up to AED 1 million!

Be disciplined about spending

In Dubai there are lots of temptations to spend. Trips to the mall, going to a restaurant or buying take away food as well as days out can all seriously dent your savings. If you’re targeting a certain number for your savings pot, keep spending to a minimum and be strict about what you buy. Your future self will thank you, even if it’s tough going without the fun stuff for a while.

Say no to family demands

This is the hardest part of saving for yourself. Families often perceive those working abroad as having a lot of money and expect to receive money either as regular payment or when you go home for a visit. Whilst you shouldn’t feel you need to cut family off completely, especially if they are the reason you’re in the UAE, it might be worth reminding them you also need to save for your own future.

Not everyone can save as much as they would like to but with hard work and discipline, you should be able to at least put something by. No one wants to leave Dubai without any savings and the best way to ensure that happens is to start today and make this the year that you build your financial future.