I like my bank. I don’t pay a monthly fee, it has good customer service and performing everyday tasks online is easy – including transferring cash.
However, I don’t have the banking app (I have written too much about fraud to want it) and I’m not at all keen on Open Banking (I don’t see any need or benefit to open up my data to third parties).
Recently, a friend of mine needed to transfer me some money. It will be a few weeks until I see him again, so he wanted to send it electronically.
Artificial intelligence: Cleo is an app with an AI chatbot – and I’m not happy with the way it tried to sign me up after a friend sent a payment
We both use the same bank, but because it had been a while since he’d wired money to me, it required him to use his little security device to make the transaction.
His was out of battery and he hadn’t got around to getting a new one – instead, he asked if he could try this new Cleo app he had downloaded.
In a nutshell, the app uses AI to scan transaction history to spot habits and help people budget. You can read about it here. He said so far, he had found it relatively useful. It also lets you send money – a relatively new feature.
So, through the power of the Cleo chatbot, he issued the payment to me by opening his Facebook messenger with Cleo and typing ‘send money’.
New age: You click to withdraw your money via Facebook chat
He then sent me a link that I had to open on my phone – and this is where my problems with Cleo lay.
To receive the payment, I had to enter my current account number, sort code, name, address, e-mail address, nationality, phone number and date of birth.
I didn’t feel comfortable doing that. It’s extremely intrusive.
Besides, if it was a bank-to-bank transaction, I wouldn’t need to.
But in the name of experimentation to see if the app worked, I went through with it.
The page didn’t say anything about becoming a customer, or have any information to tell me why it needed so much of my personal information.
Once I hit submit, it was clunky and slow. It wasn’t entirely clear if it had worked.
Basic: Where it required me to enter a raft of details, it didn’t tell me why I had to – nor that it would send an e-mail welcoming me as a customer
Shortly afterwards, I received an e-mail saying: ‘You’ve just received a payment of £80.
‘It’ll hit your bank account within 2 working days. Keep an eye out for “MangoPay” on your statement.’
Why on earth does it, in this day and age, take two working days?
The payment is coming and going into the same bank.
I’m not sure the middleman is helping here.
Younger generation? An e-mail was sent saying I had received a payment of £80 (I hadn’t – as it says it could take two days). The e-mail also had a Blue Planet II gif for some reason
Furthermore, the e-mail randomly had a ‘gif’ (a moving image) of Blue Planet II at the bottom. I have no idea why. It didn’t say ‘look, we’re a happening, cool, new app’ to me – besides, banking is serious stuff.
Then again, it has gone on an advertising blitz on social media site Instagram and has some vloggers raving about it online.
But what really irked me was an e-mail I received at roughly the same time from Cleo. The subject line read: ‘Welcome to Cleo.’
The e-mail started:
Cleo, here! Let’s get you going.
All you need to do is connect your bank. Then let the efficient money management commence.
It then had a box for me to ‘Connect Bank’ – see below.
Steady on! Cleo e-mailed me with a welcome – and a button to ‘connect bank’. I wasn’t signing up as a customer – just receive a payment
Steady on Cleo, this relationship was going too fast. I didn’t want to sign up as a customer, as I have no interest in the app – and it didn’t mention that when I entered my details it would almost trick me into signing up.
That makes me feel entering the details to get paid by someone else is also an exercise to sign-up more users.
It feels very sneaky indeed. And if there is one thing I don’t need a financial firm to be, it is sneaky.
We waited two days. The payment didn’t come. It didn’t come on day three either. On day four, my friend had to contact Cleo to find out what was going on.
I had entered my sort-code slightly wrong.
It would have to process the transaction again, via this Mango Pay system, which is a platform it has partnered with to make payments.
It also contradicts the e-mail saying ‘you’ve received a payment.’
‘I should have just sorted a new security device rather than gone through all of this,’ my friend said in a message.
I agreed – I wouldn’t have needed to input any details via my butter fingers.
‘Next time, I’ll give it to you in coins in a nice leather pouch – go back to medieval-style banking.’
In Cleo’s FAQ on how to make a payment if you’re a customer, I couldn’t find any information that mentions those receiving a payment will need to enter their details – or that it will try to sign them up.
The app uses AI – and looks to appeal to the younger generations who may find it harder to budget.
So I did the 21st Century thing and took my concerns to Twitter. It told me it needs the receiver to input information for ‘know your customer (KYC) regulations that we require the receiver to enter their name & address.’
‘Banks already have KYC’d you when you receive a faster payment from a friend.’
It agreed that this isn’t clear to those receiving cash and that it is working on doing so.
However, needing my name and address is one thing – but needing my phone number, nationality, e-mail address, bank account number and sort code, and not allowing me to leave any of these fields blank, is another.
At least it promptly responded and promises to adapt to make these KYC regulations clearer. It would have been good if it had done this in the first place.
The Twitter exchange:
Hi Lee – we request bank details so the transfer can be made, and the address for a required verification process. Hope that helps!
— Cleo (@meet_cleo) January 31, 2018
But I wouldn’t have to do that normally? IE – if someone was paying me directly from their bank to my bank? They input account details/sort-code. No address needed – and certainly no need for receiver to put in details?
— Lee Boyce (@lee_boyce) February 1, 2018
Additionally, you then sent me an e-mail saying ‘Welcome to Cleo – click here to connect your bank’. I wasn’t joining. I just wanted my payment. Felt very sneaky.
— Lee Boyce (@lee_boyce) February 1, 2018
You don’t make this clear at all as someone receiving a payment – there should really be a link on the screen saying: here’s why we need these details/don’t worry, it is not us trying to sign you up for an account
— Lee Boyce (@lee_boyce) February 1, 2018
You’re 100% right Lee – added it to our backlog.
Will let you know when it’s live, thanks.
— Cleo (@meet_cleo) February 1, 2018
WHAT THE FOUNDER HAD TO SAY
Barney Hussey-Yeo, the founder of Cleo – which has a team of 12 staff – responded to a few questions I asked him. You may remember him from the sign off to the e-mail above asking me to connect to my bank.
He said: ‘We have a small scale payment feature we offer through the EU-licensed third party payments provider called MangoPay.
‘They mandate the information we’re required to collect for P2P payments. You can view that in its public API docs here.
‘We’d love to be able to just collect your account number amd sort-code to receive a payment. To be clear, we’re not creating a Cleo account with that information, it’s required by MangoPay to make the payment.’
He says the details are required by MangoPay for the payment to go through. Cleo is a third-party app using a third-party to make payments. Additionally, he says Cleo is in early days of running the feature.
He added: ‘We’ll definitely make it clearer that we need the details for MangoPay’s KYC compliance and you’re not creating a Cleo account by collecting a payment. This is useful feedback for us.
‘We’re a growing company spreading the word about our product, and while we hope that our users’ friends will consider joining our service after receiving money via Cleo, we will never oblige any payment receivers to sign up after a P2P payment.’
So why was I told I was paid when I hadn’t? He said: ‘This was a bug, I’m afraid. MangoPay sends all their faster payments in a batch in the afternoon.
‘As the account number differed slightly, the payout failed. It’s actually the first time it’s happened and another good bit of learning for us.’
THIS IS MONEY’S FIVE OF THE BEST CURRENT ACCOUNTS