If you are not engaged with your finances or find saving difficult, then the Plum app could be for you. They can be particularly useful for anyone who frequently requests payday loans and finds it difficult to manage their money on a monthly basis.
The Plum app has been around since 2016 and has become increasingly popular over the past few years. Our Plum review explains how it works and whether this is the savings app for you.
What is Plum?
Plum is an app that works in conjunction with Facebook Messenger. It’s an automatic saving device based on recommendations made by the service once it is connected to your bank account(s). The money is then transferred to a separate Plum savings account.
How does Plum work?
It works in a similar way to other automatic saving services, although the big difference is you can only connect to it through Facebook. Plum currently work with 14 banking providers, including the likes of HSBC, Barclays, Santander and Lloyds.
In order to authorise it to carry out transactions with your account, you will have to provide your full online banking details. However, despite chatting to the service via Facebook Messenger, Plum says Facebook will not receive any of the data.
Once connected to your account, Plum will analyse your spending and make recommendations on how much you should save. Using a direct debit, it will then transfer a few pounds every 3-4 days into the Plum savings account.
You can then set your own goals, check your balance whenever you want and change your savings ‘mood’, all by simply using Facebook messenger. Changing the savings ‘mood’ means you can alter how much is being saved, or ask Plum to increase its recommendations.
Does Plum offer any interest?
Currently Plum does not offer any interest for using their savings account. The idea behind the app is to make it easier for you to save so you can meet any personal saving goals you have set.
Plum also works with peer-to-peer lender Ratesetter, which offers users the opportunity to grow your money at a rate of approximately 3%. However, this involves your money being lent to others who wish to borrow, and if they do not repay the loan, you could lose money in the process. This is optional, and not something you have to take up.
Is it easy to take money out of my Plum account?
All you have to do is send a message to Plum via Facebook Messenger using the word ‘withdraw’ and your money will be sent back to you within 24 hours.
How much does it cost to use Plum?
There is no cost for using Plum’s basic service, so you can enjoy the saving recommendations and access to your bank balance for free.
Plum also provide their own ISA, which can be invested in from as little as £1 per month. This is a robo-advisor service that recommends portfolios based on your investment amount and risk level. You will also be charged rates ranging from 0.37% to 0.95%, depending on how much you wish to invest.
How safe is it to use Plum?
Plum savings accounts are run by MangoPay. They are an EU-licensed financial organisation and the money is held in a Barclays e-money account. However, there is no Financial Services Compensation Scheme cover. Plum also state that your money is kept separate, so should MangoPay or Barclays go bust, creditors will not be able to touch it.
Plum also say they never store your bank login details and have read-only access to transaction data, which means should their security ever be breached the money in your account remains safe. 256-bit TLS encryption is in place and their servers run on Amazon’s cloud, the infrastructure they say is used by some of the world’s biggest financial institutions.
Should I use Plum?
The idea behind Plum is one of simplicity. It makes saving easy and straightforward without complicating issues with too many additional services. Once the service is set up it can just carry on doing its job without interference and you are always in control of its activities.
However, anyone who doesn’t like the idea of an app connected to Facebook, or do not own an account or use Messenger, might not be suited to using Plum.