One of my ambitions for 2022 is to dust off this long-neglected blog and get into the habit of regularly producing articles. And so, it’s somewhat fitting that my inaugural post of this year is a review of JamDoughnut, an intriguing consumer finance app in the UK available for both iOS and Android.

If you’re familiar with my work at The Next Web, you’ll know that fintech companies have always held my interest. In the three years I worked there, I covered the ascent of several industry heavy hitters, including Monzo and FreeTrade. That said, the term “fintech” is open for interpretation, and no doubt some will quibble with my application of it in this context.

Here’s the TL;DR: JamDoughnut is a cashback app, competing with industry heavyweights like Quidco and TopCashback. Conceptually, however, it diverges widely from its rivals.

Rather than buying something with a referral link and then waiting several months (often as many as nine) to get paid, JamDoughnut lets you buy gift certificates for certain retailers, which you use in place of your ordinary credit or debit card. Bonuses are recorded immediately, and you can withdraw your cash once you’ve passed the £10 threshold.

The (Dough)Nuts and Bolts

JamDoughnut’s primary advantage over its rivals is the immediacy it offers consumers. Users don’t have to wait months for retailer approval, and withdrawals are similarly speedy. Since I’ve started using the app, I’ve made two cash-outs. In both cases, the money hit my bank account on the same calendar day, regardless of whether it was a weekend or working day.

I note that JamDoughnut says withdrawals may take up to five working days. That may be cautious conservatism on their part, or I may simply be a lucky outlier. I’ll update this post if the latter turns out to be the case.

The app touts a generous selection of retailers, although a few retail giants are conspicuously absent. There’s no Amazon, although Argos and Blackwell’s are both represented. Tesco is similarly missing, although every other major supermarket is present, including Waitrose, Sainsbury’s, Asda, and Morrisons.  

Cashback rates vary widely. At the higher end, you can get 10 percent back on Costa purchases. Towards the middle of the pack, you’ll find the likes of Deliveroo and Asda, which offer five and four percent respectively. Considering Quidco offers just 1.1 percent on Deliveroo for existing customers (with the aforementioned waiting), that’s nothing of exceptional.

Obviously, there’s no guarantee retailers won’t reduce those rates in the future. Still, if we assume they stay the same, it’s clear punters can save a decent chunk of cash with consistent use.

Let’s assume the average two-person household spends £250 each month on groceries, £50 on takeaways, and £100 on Ubers. With JamDoughnut, they’ll end up with £20 back each month. That works out to £240 over the course of a calendar year, and we haven’t included things like clothing, books, holidays, or consumer electronics. Not bad.

Minor complaints

When using JamDoughnut, you can’t escape the feeling this is a product from an early-stage startup. Some functionality you’d expect simply isn’t there.

Gift cards, once used, don’t automatically disappear from your wallet. You’ve got to manually archive them by swiping left. Additionally, you can’t do this from the home screen, but have to enter a separate part of the app.

Similarly, there’s no search functionality whatsoever. I imagine this is something that will become an irritation if you habitually use JamDoughnut over a long period. If you need to find a particular gift card, you must swipe through your wallet until you find the right one.

Finally, JamDoughnut doesn’t let you natively export your gift cards as a PDF that can be printed or emailed, nor upload them to your Apple Wallet. That functionality, when it exists, is provided by the retailers themselves. Deliveroo, for example, lets you print your purchased gift cards. Argos lets you add your voucher to your Apple Wallet.

This makes for an inconsistent experience. It also means that, depending on the retailer, you might struggle to give your voucher to another person. I bought my sister-in-law an Argos gift card for her birthday and was forced to send her the barcode as a WhatsApp screenshot, as there was simply no way to export it.

JamDoughnut’s biggest Achilles’ heel is the lack of payment options. Users can choose to purchase gift cards using automatic bank transfers powered by Open Banking Payment Initiation Service (PIS), or through Apple Pay and Google Pay. If your credit card doesn’t support mobile payments, you’re out of luck.

Conclusion

Despite those minor gripes, JamDoughnut has seriously impressed this cynical tech journo, and it’s something I’ll use in the long term. Although still in its most nascent stages, the company has the potential to disrupt a stagnant industry. Still, it’ll take some work to dislodge the incumbent cashback providers.

The biggest challenge is convincing consumers to change their payment habits. Every time I’ve explained the concept of JamDoughnut to friends and family members, I come up against a brick wall of scepticism. The UK lacks solid consumer protections with respect to gift cards. Unlike certain US states (most notably New Jersey), the UK allows for gift cards to expire after a pre-defined point.

Additionally, when you buy a gift card, you’re effectively betting that a particular business will remain trading by the time you use it. There’s little chance of Tesco declaring bankruptcy in the foreseeable future, but other brick-and-mortar names aren’t as lucky. The past decade has seen a bloodbath on the high street, with once formidable brands like Maplin and Debenhams spiralling into insolvency.

JamDoughnut undoubtedly hopes it can overcome that cautiousness by offering generous cashback rates, paired with a level of immediacy you won’t find anywhere else. Whether that will be enough to propel it into the fintech stratosphere remains to be seen.