Wio Bank, an Abu Dhabi-based digital bank that was formed last year, has introduced its second online offering, Wio Personal, aimed at helping retail clients manage their finances.
In its first year of operations, the digital bank focused on small and medium enterprises and recorded 45,000 account openings across its Business and new Personal applications, it said on Thursday.
Wio Business was the bank’s first digital app that gave freelancers and SMEs access to business banking services.
"We want to give customers confidence to manage their money because a lot of people struggle with it," said Jayesh Patel, chief executive of Wio Bank.
"We want to give them more value, for instance, by offering high interest rates on savings and 1 per cent cashback on debit card spend," he added.
"One of our big focus is also to help our customers have a better tomorrow. We want to encourage savings and allow you to start an investment account easily."
Wio Personal will target digital-savvy customers, families and youths who are starting their financial journey. Eventually, it will widen its focus to other customer segments, Mr Patel said.
With a total invested capital of Dh2.3 billion ($626 million), Wio Bank is jointly owned by Abu Dhabi holding company ADQ, Alpha Dhabi Holding, telecoms operator e& – formerly known as Etisalat – and First Abu Dhabi Bank, the UAE’s largest lender by assets.
Wio Bank secured approval from the UAE Central Bank last year to start operations.
Digital banks are increasing in popularity as cashless payments and FinTech services gained traction amid the Covid-19 pandemic.
Traditional banks are also focusing on boosting digital services. Abu Dhabi Commercial Bank, Emirates NBD, Mashreq Bank and Abu Dhabi Islamic Bank – the biggest Sharia-compliant lender in the emirate – have already set up digital banks.
Zand, the Emirates’ first digital bank that aims to cater to retail and corporate clients, was also granted a banking licence last year and is headed by Mohamed Alabbar, Emaar Properties’ founder and former chairman.
Wio Bank’s new app offers retail customers all banking services, including opening an account, deposits and withdrawals, international transfers, tracking expenses, saving and investing money, and cashback on card spends.
Using their Emirates ID, customers can open a Wio bank account and an investing account “within minutes”, according to the statement.
“The platform will provide a holistic view of an individual’s financial landscape, enabling better decision-making,” the bank said.
“Users can ascertain their financial health, identify spending patterns and make informed choices about saving and investing – all in one place.”
There is no minimum balance requirement to maintain an account with Wio Personal.
The Wio Personal app offers two plans: the Standard plan for Dh25 a month and the Plus plan for Dh49 per month.
Customers on the Standard plan who maintain more than Dh3,000 in their account will have their monthly subscription fee waived, the bank said.
It added that they will also receive a physical and virtual card free of charge, while there is no fee on local and international money transfers.
Under the Plus plan, customers with more than Dh35,000 in their Wio current or investment accounts and/or “Saving Spaces” will have their monthly subscription fee waived.
The Plus plan will also offer users a promotional interest rate of 6 per cent interest per annum for savings of up to Dh5 million, Wio Bank said.
When asked what the interest rate would revert to after the promotional offer ends, Mr Patel said it would be announced soon.
Customers maintaining an account balance of Dh5 million or more will be eligible for 4 per cent annual interest. In addition, users can avail themselves of 2 per cent interest per annum on their US dollar savings.
These rates are valid until December 31 for money deposited in Wio Personal’s Saving Spaces, the statement said.
While the cost of borrowing globally has risen in line with interest rate increases, banks in the UAE continue to hold back on offering the benefits of the central bank’s interest rate rises to savers.
In February, UAE money management app Sarwa unveiled a cash account with a 3 per cent annual interest rate to help customers boost their savings power. Meanwhile, digital wealth manager StashAway raised the rate of return on its cash management portfolio to 4.5 per cent in May.
Wio Bank users can gain access to about 2,000 global stocks, exchange-traded funds, fractional shares and even initial public offerings in the UAE on the platform. They can start investing with $1 with zero commission fees, the bank said.
The stocks and ETFS will be offered by Wio Securities, which is licensed by the Securities and Commodities Authority, while the IPO service will be provided by Wio Bank, the bank's website showed.
Wio Bank has plans to introduce a 60-day interest-free credit facility with no annual fee. Customers who borrow money using this facility will have to pay interest of 2.5 per cent after the fee-free period ends, the bank's website states.
"We plan to introduce credit for Wio Business customers," Mr Patel said. "For Wio Personal, we will broaden investments significantly and offer more educational insights so customers get more confident with money management."
The company has collaborated with government entities, business set-up organisations, and FinTechs to provide "exclusive financial benefits" to its customers, the bank said.
These include advisory support for business ventures, access to online payment solutions, discounted point-of-sale machines, invoicing assistance and lifestyle discounts, it added.