Loot has no more loot
RBS-funded app Loot has gone into administration. An unfortunate casualty of the modern and very welcome disruption of the retail investing sector
The current and very interesting wave of challenger banks bringing some very modern initiatives into the rpersonal investing sector whilst traditional banks scale back their retail operations is of great significance.
The entire Square Mile is adorned with a litany of ultra-modern displays and mobile advertisements for extremely clever initiatives ranging from bonds with 8% return, crowdfunded by culinary experts rather than bankers, and offered via a Mexican restaurant chain to smart trading and banking applications such as Revolut.
As with any revolution, if the pun can be pardoned, there will always be casualties, as disrupting a traditional industry that is as well established as the high street banking sector is not an easy task, and on that basis, the challengers that have risen to significance this far must be congratulated for their resolve, innovative skills and foresight.
For Loot, however, the end of the road has been reached.
The company, which was an app-based financial platform for what it termed ‘digital current accounts’, literally banking for retail customers which does not have physical branches, was invested in by RBS to the tune of £5 million and had managed to onboard 212,000 customers in its relatively short life.
As is the current trend among modern FinTech startups in London, Loot resorted to crowdfunding initiatives to raise the capital to expand its offering to clients. The company started its operations by offering a current account and contactless Loot Mastercard card, and providing insights into its customers’ spending with personalised features to assist the management of money.
This week, however, the firm posted on its website:
“It is with regret that we are informing you that Henry Anthony Shinners and Adam Henry Stephens of Smith & Williamson LLP, 25 Moorgate, London, EC2R 6AY were appointed as joint administrators of the Company on 22 May 2019. Your e-money is protected and held by Wirecard Card Solutions Limited at a regulated credit institution.”
” Your funds will not be used by Loot or Wirecard Card Solutions Limited for any other purpose. You are still able to continue to use the account as normal. We are working with the administrators and we will announce further updates here in due course. In the meantime, if you have any questions please email us at [email protected]”
“The affairs, business and property of the Company are being managed by the administrators Henry Anthony Shinners and Adam Henry Stephens who act as agents of the Company and without personal liability.”
“Henry Anthony Shinners and Adam Henry Stephens are licensed as insolvency practitioners in the UK by the Institute of Chartered Accountants in England and Wales. As such they are bound by the Insolvency Code of Ethics when carrying out all professional work relating to an insolvency appointment.”
Despite this setback by a well meaning firm which had begun its business with very good credentials and the backing of a due-diligence orientated Tier 1 bank, the future still, it appears, lies among these new participants for retail investment whilst the Tier 1 banks concentrate their efforts on their core business activities, those being FX dealing and order flow management.