British-based fintech company Revolut has added a new feature called “Stays” to its digital banking app, allowing users to book hotels, while simultaneously managing their finances. Jenny Southan reports
Revolut, which was valued at about US$33 billion last week, will also allocate £70 million in cashback to customers using the new service, who each receive up to 10% cashback on accommodation bookings via Stays as an incentive. The company says it could save the average customer £69 per year.
Users will also get exclusive rates and Revolut won’t charge booking fees – although fees and charges from accommodation providers may apply.
Stays pits Revolut against online travel agents such as Booking.com, will ultimately allow users to make reservations for flights, experiences and car rentals. In addition to hotels, it will also allow people to book B&Bs and lodges.
Described as “the UK’s fastest growing financial super app”, Stays is part of Revolut’s ambition to help people spend “more smartly” when travelling. It went live this week in the UK, with EU and US launches coming in the next few weeks.
Marsel Nikaj, head of savings and lifestyle at Revolut, says: “As the world begins to cautiously open up, we know everyone is desperate to get away whenever they can – whether it’s to Margate or Mallorca.
We’ve built Stays to make it easy for people to find and book their perfect break in their ideal destination. After 18 months of endless restrictions and lockdowns, we want to give people more and make their money travel further. Revolut is becoming the go-to app for travel, giving you more.”
Revolut’s new super app, Stays, could threaten the profitability of leading travel brands across Europe and the US, says GlobalData
The leading data and analytics company notes that the app has beat leading brands in the move towards end-to-end booking solutions, which comes right at home with travel-hungry customers looking for deals online.
Johanna Bonhill-Smith, travel and tourism analyst at GlobalData, says: “Revolut’s app allows travelers to book accommodation ranging from B&Bs to luxury lodges, as well as offering payment end solutions and currency exchange rates without fees.
“The online travel space is dominated by large industry brands such as Booking Holdings, Expedia Group and TripAdvisor. Booking Holdings has been working towards its end-to-end booking solution as a ‘connected trip’ for some time but it has not yet come to fruition. Revolut may have seized a market opportunity at the right time.”
Various factors are likely to aid the app’s success, with the most important factor being the high demand for travel. GlobalData’s Poll found that demand is highest for domestic trips (43 per cent) in 2021.
However, travelling to a different continent (37 per cent) and other countries in the same continent (29 per cent) is also high.
Even though international travel restrictions threaten international travel’s recovery in 2021, the domestic market will continue to prosper. Since the app covers all market bases, this is not likely to interfere with Revolut’s popularity.
Bonhill-Smith says: “Revolut already has a large existing customer base. It currently has 16 million global users and was recently valued at US$33 billion in its last funding round, demonstrating its competitive stance within the marketplace.”
After booking through Stays, customers will be awarded up to 10 per cent cashback. Price and value currently play the largest role in booking hotel/accommodation for 47 per cent of respondents, according to a survey by GlobalData.
Therefore, any form of saving and “value for money” will be welcomed by consumers, and could make booking through Revolut more attractive.
Bonhill-Smith adds: “Throughout the pandemic, consumers have been spending more time online. GlobalData’s Q2 2021 consumer survey revealed 35 per cent of respondents are more frequently spending time online and 12 per cent have started doing this over the last three months as a result of the Covid-19 pandemic.
“This means consumers are more confident in making transactions online and may be more inclined to use a server that holds end-to-end solutions in the booking process, which bodes well for Revolut’s new venture.”