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VibePay embeds payment channels inside social groups so money moves between friends and brands with zero friction – £12M raised.
ENTRY ANGLES
Alternative revenue models for digital banks/payment operators as transaction fees approach zero · Products built on assumption that traditional fintech revenue streams will disappear
VERTICALS
CAPABILITIES
understanding of emerging fintech revenue models, ability to anticipate structural changes in payment economics
VIBEPAY FOUNDER
“You want to know how to paint a perfect painting? It's easy. Make yourself perfect and then just paint naturally.”
VibePay wants to "turn everything that matters into a channel." What matters, according to the startup, is communication between people – and between people and the brands, merchants, and banks they interact with.
The app lets users create channels for exactly these purposes. Personal channels serve friend groups, family circles, and communities of interest. Brand channels connect users with the companies they buy from. And underneath it all, financial rails let money flow alongside words – because VibePay enables payments to any UK bank account holder, whether an individual or an organization.
Users can also request payment from anyone with a UK bank account – essentially an invoice that the other party can settle with a single tap.
To make the payment system work, users connect their existing bank accounts through open banking protocols. The result: merchants can invoice customers within the app and receive instant payment; after purchase, that buyer automatically joins the merchant's channel – creating a CRM relationship that the merchant can activate:
- Sending reward payments to active, loyal customers for purchases, surveys, or other engagement.
- Broadcasting messages to channel members – news, special offers, personalized outreach.
Merchants can also use VibePay's paid marketing services: branded channels with expanded capabilities, and targeted message delivery to VibePay users based on selected audience criteria.
The targeting goes beyond demographics. Because VibePay sees what its users actually buy and spend, it can target by purchase behavior – not just age, gender, and location, but actual demonstrated interests and spending patterns.
VibePay also courts community builders – newsletter operators, social media group administrators – inviting them to migrate their audiences into VibePay channels. The pitch: you can already post content and message subscribers; now you can also monetize seamlessly through built-in invoicing and payment, taking subscriptions or charging for premium content, all without relying on third-party payment processors.
The headline differentiator is that VibePay charges zero transaction fees. Merchants and community owners keep 100% of what their customers pay – with no PayPal, Stripe, Square, or Revolut cut.
Revenue comes instead from paid services: purchase behavior analytics for merchant channels, targeted marketing broadcasts to app users, and similar data-driven add-ons.
VibePay is based in the UK and has approximately 250,000 users. It has just raised £5M (approximately $6.5M), bringing total funding to £12M (approximately $15.5M) across four rounds.
Zero transaction fees isn't a launch discount – it's a deliberate ideological position. VibePay believes transaction fees are structurally doomed, and it's building now for the world where that's true.
If that transition happens, many current wallet apps and digital banks – which generate most of their revenue from transaction margins – will be in serious trouble. Or they'll scramble for new business models.
VibePay's argument is that it already sits above the bank layer: positioned between consumers and the brands they buy from, while traditional banks handle the plumbing underneath. VibePay doesn't want to become a bank; it wants to connect to existing banks via open banking and occupy the layer where actual value is created – the audience data and behavioral targeting layer.
This connects neatly to Paul Graham's old essay on how to find startup ideas.
Robert Pirsig wrote in *Zen and the Art of Motorcycle Maintenance*: "You want to know how to paint a perfect painting? It's easy. Make yourself perfect and then just paint naturally." Paul Buchheit extended this into a startup principle: people at the frontier of technology "live in the future." Combine those ideas and you get: *imagine yourself living in the future and build what's missing to make it work.*
VibePay is living in a future where transaction fees don't exist. And it's building the infrastructure layer that will let fintech companies survive in that future.
This is notably different from the playbook many other startups follow – build a community first, then launch a card to monetize transaction flow. Khyaal ([related review](/review/s-jetoj-storony-tozhe-mozhno-zajti)), an Indian startup, first built a community of 2 million older adults and then launched a branded card to earn on all their spending (plus merchant commissions on in-app marketplace purchases). Khyaal has raised $10.6M, including funding that came in after the original review.
VibePay is running the logic in reverse: no card, no transaction fees, but a monetizable audience data layer built from day one.
"Live in the future" is a powerful filter for startup ideas precisely because it forces the question: which of today's revenue models are already obsolete, just not yet dead?
For example: demand for language learning – adult courses, tutoring apps, language schools – is growing now as global business expands and remote work connects people across borders. But high-quality AI translation is approaching real-time usability. Early versions are already good enough for everyday use. At what point does language learning demand structurally decline? It may be worth thinking twice before building another product in that category expecting organic long-term growth.
That example may seem extreme. The point is the method: imagine yourself five to ten years out. What has appeared that doesn't exist today? What has disappeared that does exist today? Build the former; avoid the latter. The bolder the future you imagine, the more strategic the startup that results.
Applied to fintech: transaction fees really may shrink to near-zero or disappear entirely. If they do, what will digital banks and payment operators use as a revenue model instead?
That's the product to build now – either to sell to those banks and payment operators when the moment arrives, or to compete with them directly.
VibePay is one answer to that question. The more productive exercise is picking a specific revenue category that exists today – transaction fees, interchange, lending spreads – and asking: what does the company that replaces this look like, and what can be built now to occupy that position before the transition completes?