Savings app Qapital wants people to make more conscious decisions around their money. While to date that meant helping its users build up savings, now Qapital will help manage their day-to-day spending through a new checking account and debit card.
Qapital was founded about four-and-a-half years ago in Sweden and originally launched as a competitor to Mint in the personal finance management (PFM) category. The company came to the U.S. in 2014 and soon after began focusing exclusively on this market.
The Qapital team decided it could do a lot more than just provide a dashboard for budgeting, and made an automated savings tool central to its service. With that in mind the app switched to providing an easy way for users to create short-term savings goals.
“PFM is a good starting point but isn’t very useful,” said Qapital CEO George Friedman. By aggregating data around all of a user’s spending and also taking into account the things they want to save for, he believes Qapital can be much more useful. “If we know what you want to achieve and what your goals are, we can help you get there.”
Now the company is taking the next step in its evolution by adding a checking account and debit card to its service. By doing so, it will combine account aggregation, savings and spending options all in one place.
Qapital users will no longer have to transfer their savings back to their primary checking account once they’ve hit a goal. A user who was saving up for vacation or another make a big-ticket purchase can now do so with Qapital’s debit card.
But the hope is that in the long term, Qapital will provide enough value to users that they’ll decide to make it their go-to account for all their spending needs. That means getting users to set up direct deposit
In addition to providing a single place for users to view all their accounts, Qapital wants to provide a best-in-class checking account. Launched with banking partner Lincoln Savings Bank, the account does away with overdraft and other fees charged by some of the incumbent banks.
“To us, it really comes down to making the value proposition compelling in how we combine spending and savings together,” Friedman told me. After testing the new account type with 10,000 of its existing users, Qapital will be rolling out the product more widely.
Of course, Qapital isn’t the only banking product out there that has sought to help users save toward their goals. Simple, one of the earliest online alternatives to the big banks, launched a savings feature years ago.
More recently, a startup called Varo Money launched a checking account and debit card combined with its own PFM features. And online lender SoFi has made its banking ambitions clear through its acquisition of Zenbanx and application for an industrial bank charter.
In general, we’re likely to see more companies combine data and new features designed to save users money as they seek to take on the big banks. Qapital, which recently raised $12 million in Series A funding from Industrifonden, Northzone, Rocketship VC and Anthemis Exponential Ventures, is just at the forefront of that trend.
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