AAA Russian banks support Moven’s banking revolution

Russian banks support Moven’s banking revolution

East-West Digital News

Life.SREDA, a Russia-based venture capital fund established by members of the Life Financial Group, comprising eight commercial banks, revealed in August a $2m investment in Moven, a three-year-old New York-based banking startup.

Moven’s CEO and founder Brett King hopes that the deal, which took place in July, will help his company further upgrade what he calls a “world-class mobile solution to the problem of the next-generation bank account.”

In an exchange with East-West Digital News, Life.SREDA did not disclose the terms of the deal, nor did it specify its partners in the investor consortium, saying only that Life.SREDA was “the largest investor” in the group.

The transaction has brought Moven’s total investment since inception to $4.41 million.

Thanks to the Russian investment, the American company – which launched its service back in 2011 – will introduce a new banking model that uses social, mobile, and gamification technologies and implements a new scoring system based on analysis of social networks data.

Presenting itself as “the world’s first cardless bank,” Movenbank offers its customers, who are mainly “upwardly mobile” young 25-35 year-old professionals, an innovative way of tracking their spending by “categorizing transactions and creating a purchasing behavior profile allowing further adjustments.”

The principles of network marketing via social networks are also in play since a customer improves his or her credit rating by bringing in friends from social networks, Life.SREDA said. There is also a system of rewards and bonuses for “healthy” financial behavior.

To monetize its effort Moven uses paid subscriptions as well as loyalty and rewards programs and also exploits changes in interest rates on savings and banking loans, the Russian investor explained.

Established in 2011 with an initial capital of $10 million, Life.SREDA has a history of supporting finance-related mobile and Internet technologies. Last October, it injected an unspecified amount in Instabank, a Moscow-based startup pushing its mobile social banking project.

Two months later, the fund pumped $2.6 million into Life-Pay, a startup developing smartphone-based bank card payment terminals. Finally, in December 2012, in an apparent diversification of its project portfolio, Life.SREDA invested $1.5 million in My-Apps.com, a Russian mobile apps builder that operates internationally.

This article first appeared in East-West Digital News, the international online resource on Russian digital industries.

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