Meet Pockit, the FinTech which is quickly becoming the one stop shop for unbanked people
I spoke to Virraj Jatania, co-founder and CEO of Pockit, about how he takes advantage of the business knowledge cultivated at a young age after working for his father to provide an alternative banking platform that is the lifeblood of initiates social change and serves those who are unbanked in the UK
Jatania is also a member of YPO, the global leadership network of 28,000 senior executives and business leaders whose companies together generate more than $ 9 trillion in annual revenues.
He told me that estimates show that there are at least four million people without a bank account or struggling with restricted access to banking services in the UK today. Moreover, while financial exclusion exacerbates poverty and inhibits social mobility, it is one of the least discussed but most prevalent social problems of our time. This is where Pockit comes in.
In a bid to support people who have been cheated by their traditional banks, Pockit helps underserved, low-income UK customers manage their money with a bank account they can open in two to five minutes.
Pockit offers its 500,000 customers a full UK bank account into which they can pay their salary and benefits, deposit money at 30,000 PayPoint points across the country and receive a debit card to use for spend 99 pence per month.
Everything is handled through the Pockit app or their website, which Jatania says is the staple product customers can use to send money to 35 countries.
Providing the context, Jatania explains that her family business had “a lot of business in emerging markets, which means I spent time growing up in India, Russia and the Middle East. I have seen first-hand the challenges facing excluded and dominant cash consumers.
“We had manufacturing operations in a number of these countries and even more developed markets like the United States, and what we saw was that blue collar workers were often paid in cash, by check or on family accounts. These people were also looking for loans to make ends meet. It piqued my interest. “
Jatania goes on to say that people are financially underserved no matter where they come from – developed or developing. On top of that, the banks don’t gamble for this space either. “When you look at their business model, you understand why.
“There is a high cost to serve, with a very high cost involved in branch office infrastructure, legacy processes, and legacy technology and frankly a lack of willpower as focusing on the underserved segment will not generate the income that banks are looking for. “
After launching in 2014, Pockit has since been granted an e-money license, known to be significantly lighter in terms of regulatory capital, but startups can do business much like a bank – albeit customer deposits. closed customer accounts are held in ring and the accounts are not covered by the FSCS: Financial Services Compensation Scheme.
Pockit currently serves low-income people across the country “unlike many other fintechs that have large hubs in London, a large portion of our customers are outside. About 25 percent are new to the country and the rest are UK nationals, ”says Jatania.
Rather than creating a product focused on a particular group of excluded people such as the homeless or refugees, the startup is focusing on ‘the 20 million people in the UK who have saved less than £ 1,000, cannot not afford a surprise payment of £ 250 and operate with tight and volatile cash flow.
Although the initial onboarding process involves a name-to-address match, customers have the option of providing identification on their own, and “there has been a small percentage of cases where onboarding of a homeless client proved to be much more difficult, but we worked with relating them to the address of a shelter.
This is what sets Pockit apart from the big banks. Jatania says the big banks make it incredibly difficult for this customer segment to access a basic checking account, and even with a checking account, they wouldn’t be able to send money home. “Banks are retaining many features for their higher income customers,” concludes Jatania.