Feedback on this website and idea

https://www.hailtum.com

Hi,

I would like your opinions on the service. It's basically a platform that helps people save money by locking it away for a duration. It's available only on the UK currency. What're your thoughts?

Thank you.

https://www.hailtum.com

rashid777

submitted this linkon June 8, 2019

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Are you holding the money on your own account? If so, are there legal implications for you in doing that?

I don't think I'm your target customer, but maybe you could put something in the FAQs to make people feel safer about giving you their money. For example, if it's in a bank then I know it's protected in the event that the institution goes out of business or the bank manager decides to move to the Bahamas with my money 😀.
I'd also have a concern about missing out on any interest I would earn.

I don't mean to sound negative, and you may have thought of these things already. I just didn't see them in your FAQs or terms of service.

daves106

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7 years ago
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  Also, do you think the price is far?
  
  rashid777
  
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  7 years ago
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  Oh OK, I need to mention that. It is indeed stored in a bank (from the UK). I don't really want to focus on interest for this service. Our aim is to help save money with your spare (money) change.
  
  What questions do you wish to have in the FAQ page?
  
  rashid777
  
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  7 years ago
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    I understand the idea behind it, and I think there is definitely something in helping people to save money more effectively.
    
    As a customer, though I would have some concerns.
    
    Since (I assume) you are not a regulated bank/building society/credit union, how are my savings protected in the event anything happens to your business?
    
    You're charging a fee, but I assume you're also earning interest on the customer's money in your account. If so, aren't I effectively paying you twice (the daily fee, plus the interest I'm not earning myself)?
    
    My guess would be that this service would be used by those who normally struggle to budget/save effectively (otherwise they would save into their own account). I don't know how I feel about charging them to save their money for them, instead of helping them to invest it somewhere they can earn their own interest and be financially better off?
    
    I would also have concerns if I was in your shoes, starting this business:
    
    If you scale, you're going to be holding large sums of money in your bank account. How can you manage this so that your customer's money is safe if anything happens to your bank?
    
    What are the legalities of holding people's money and acting as a savings account?
    
    Sorry for the long post. I hope it comes across as constructive.
    
    daves106
    
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    7 years ago
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      Thanks for the questions.
      
      Your savings and business money is separated. So when if the business goes down, we will notify you and send the money back to your account.
      
      Ok, I think this is confused. So, the money you pay daily, your money savings are from the daily pay. For example, £1.50 you pay daily is saved to your bank but you pay an additional fee (40p). You don't pay the daily payment and deposit more on top. I need to clarify this.
      
      The thing is, I don't want to go to the "interest" approach because there are many services offering this. Do you know any other way profitable than interest?
      Since the money itself is generally stored in a well-known bank. The policy is generic in any bank system.
      
      rashid777
      
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      7 years ago
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        Just to answer each point:
        
        As a prospective customer, I have to take your word for it that you won't go bust and lose my money though - or just leave the country. I have no protection (as I would if you saved in a regulated bank). I'm sure you'll manage the funds appropriately, but remember people on the internet don't know you - why should they give you their money instead of using the safety of a bank? I think this needs to be clearer.
        
        I understand, but my point still stands - why would I give you my £550/year, and pay you £150 for the privilege? Why wouldn't I put it in a bank, where it is safer and they pay me (as interest) for doing so.
        
        The reason the 'interest approach' is commonly used is because it means that banks can give their customers 'free' money instead of charging them, as you are. They take your money and invest it, giving you some of it back as interest - everybody wins (assuming the banks operate responsibly with your money, of course).
        
        "Since the money itself is generally stored in a well-known bank. The policy is generic in any bank system."
        
        If you mean that the funds are protected by the FSCS because they are in your bank account, there's a limit to how much is protected under that scheme. You will hit that limit if you have ~155 customers saving for 1 year on your basic plan. At this point, you'll be making ~£23k revenue per year. In other words, you're going to need to deal with those complications before you're making the average UK wage from your business.
        
        Lastly, and I don't want to sound like a broken record, but I really would consult a lawyer or financial expert . It sounds a lot like you're providing a savings instrument, and I don't know if there's any regulation around that (and couldn't easily find out from google)
        
        daves106
        
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        7 years ago
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        I understand where you getting from. I'm not really sure how to tackle this problem?
        
        Two reasons: you lock money away for a duration; this means you keep saving without pinching money out for a duration. After the duration deadline, you can then request a withdrawal. The second reason is the structure. Your savings are organized, so you can create many funds which has different purpose and goals. This is not something available. So, the fee you're adding is payment for these services.
        
        I'm not doing interest because of religious reasons.
        
        I would need to read upon FSCS to learn more. I guess this is something to do after I validate the product. It's an MVP version and I'm just testing out the product.
        
        A lawyer/financial expert is something I'm progressing. This is my side project (university student), so it will take time. So maybe some form of trading in banks is something I need to offer. So, I thought of a different way. Our customers can contact us to help them purchase something (that they can't purchase up and front like a car) and in return do a monthly payment (and a little profit). I guess I can do that.
        
        rashid777
        
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        7 years ago
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And how much money would it cost me to lock my money away from myself ?

SUPERViLLAiN

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7 years ago
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  Does your bank lock money away? Do you want to go that hassle?
  
  I'm just talking about the UK only (not sure any other country).
  
  rashid777
  
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  7 years ago
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