The UK is home to one of the world’s most advanced fintech markets – everyday there seems to be a new challenger looking to offer something different. New digital bank Monument describes itself as meeting the needs of professionals, property investors and entrepreneurs. Evie Rusman writes
Monument promises to deliver an “unrivalled level of service” to meet the unmet demands of 3.5 million mass affluent clients in the UK with a net worth of between £250,000 ($315,000) and £5m, as they save and grow their wealth.
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Earlier this month, the challenger announced that it was in the latter stages of its application for a banking licence, after applying in December 2019.
Once Monument launches, it plans to offer savings and property investment lending products through an entirely digital app and online services.
Speaking to RBI, Monument COO Steve Britain says: “When we first launch we will be going to market with savings and lending – on the savings side, fixed-term deposits and easy access. We’ll be offering very competitive rates – top quartile. We also recognised that loyalty is something that is missing from this community.
“So, when you take a big term deposit and then you decide to renew it after six or 12 months or so, we will give you a better rate than you would get if you’re a new client coming to Monument. And that will be a philosophical principle that we adopt, because the alternative is that most banks attract to you with a high rate and then wind back on that over time. That really becomes an annoying factor.”
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By GlobalDataOver £10m has been raised by Monument Corporation in seed funding thus far, with working capital for about 15 months.
A unique experience
The bank, whose executives and board have held senior roles at HSBC, Barclays, McKinsey & Co, UBS and Goldman Sachs, among others, hopes to offer a unique customer experience that has not yet been addressed by UK challengers.
As part of its initial launch, Monument will offer buy-tolet property lending of up to £2m. John Saunders, chief commercial officer at Monument, discusses with RBI how Monument is closing a gap in the market by offering something different from its competitors.
“We are doing buy-to-lets at a higher level of up to £2m, and there are a lot of lenders that will not go that high,” he says. “Also, a lot of people now, when they buy property to invest in, do it through limited companies, and a lot of existing lenders have really struggled to adapt to that because their technology doesn’t really allow it. They tend to have legacy systems that are really expensive and very difficult.”
Saunders continues: “It is a combination of what we will do and how we will do it that will differentiate us from the players that are already there.
“The other point to raise is that if you look at the other banks that are already there, the neo challengers, they focus on different things, so a lot of them are very much on the mass markets or current accounts. That’s not what we’re about: we are fully focused on FX or SME lending. There’s no one in the new generation of banks that is really focusing on this community and doing the things we will do for them in the way that we will do it.”
Covid-19
As in most sectors, Covid-19 has had a significant impact and has ultimately caused demand for digital services to soar. Through Monument, users will be able to choose an entirely digital banking experience and use live chat, video and co-browsing features for digital client support.
Expanding on Covid-19’s impact on the launch process, Monument CEO and co-founder Mintoo Bhandari explains: “We never planned to launch a bank during a global pandemic, but it turns out – as we now find ourselves in the latter stages of the regulatory approval process – the timing is highly relevant.
“Clients want the ability to bank effectively at their convenience and wherever they are – on their phone or computer – and more robustly than they would have imagined possible just last year.”
Britain adds: “Covid-19 has meant that we have been building a bank remotely, so that’s been quite an interesting development – but actually one that we’ve embraced extremely effectively and productively. “We’ve set ourselves up to operate in the cloud and to be accessible wherever, so when we had to start working from home, the process was seamless. The regulatory process has largely continued as we expected.”
