HSBC to rival Revolut and Wise with ‘Zing’ app
HSBC is launching a new multi-currency payments app, ‘Zing,’ in the UK, aiming to offer competitive foreign exchange rates to retail consumers. The move positions HSBC to compete with rapidly growing digital rivals like Revolut and Wise.
Starting today, UK customers can access Zing, which will allow them to hold money in 10 different currencies, spend money abroad with low fees, and make international transfers in over 30 currencies.
The UK banking giant said it rolls out the millennial-geared service to onboard “millions of customers over time”, before expanding into other countries in Europe and Latin America. HSBC plans to expand Zing to additional markets later this year, with plans to reach at least two more continents by the end of 2024.
Zing is part of HSBC’s strategy to compete with fintech companies that have gained significant popularity over the last decade. For instance, Revolut has attracted over 38 million users, and Wise reports about 10 million customers in their latest filings. The launch of Zing led to a drop in Wise’s shares by up to 6% yesterday.
HSBC’s approach with Zing is to attract a younger generation of customers and convert them to other HSBC products. The app, available on Google and Apple app stores, will be regulated as an e-money institution rather than a bank, meaning its deposits won’t be protected under the Financial Services Compensation Scheme.
This foray into fintech follows HSBC’s investment in Monese, a UK-based startup offering current accounts to those underserved by mainstream banks. Despite a challenging outlook for fintechs due to higher interest rates and a shift in investor focus towards profitability, HSBC’s investment in the digital banking market mirrors similar moves by other major banks.
JPMorgan Chase, the biggest US bank by total assets, launched its City’s digital-only bank in 2021, which offers a range of savings and loan products under its ‘Chase’ brand in the UK. The launch spurred a shakeup in competition and prices among incumbent lenders, including with its rival Goldman Sachs that launched its retail consumer bank, Marcus in the UK in 2018.