Since it was founded in 2015, Monzo has gone from strength to strength. It’s CEO and co-founder, Tom Blomfield details the journey of Monzo and why the UK challenger bank is not for sale. Briony Richter reports
Blomfield aims to build a bank that works seamlessly for everyone, creating a platform that enables customers to conduct their banking needs effortlessly.
Go deeper with GlobalData
The past year has been an extremely busy year for Monzo. The challenger bank gained its banking licence in 2017 and in March 2018, it was announced that half a million upgraded current accounts were opened. Monzo shows no signs of slowing down for the rest of 2018.
Speaking to RBI, Blomfield states: “Keeping it to retail banking, the evolutionary market is moving away from high street banks towards a platform of a single interface between the consumer and their money. That’s what we are building at Monzo.
“I think this evolution is moving towards a new category that doesn’t have a name yet. You could maybe call it smart banking or financial control centre. It will look very different from the banks today,” he adds.
Customer care is at the heart of what Monzo does. Blomfield explains that traditional banks are struggling to improve their platforms to create a more strategically-focused and customer-centric system.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“In the banking industry there are a number of key problems. One is that there has been far too much focus on financial products. Another is that banks assume people make decisions based solely on price. Both of these things are fundamentally flawed.” He continues saying that although cost is an important factor, it comes down to the user experience.
Not for sale
PSD2 encourages collaboration and competition. It’s not just the traditional banks that are facing stiff competition.
Earlier in the year, it was reported that Amazon was considering moving into the banking space via a potential partnership with banks such as JP Morgan to offer its customers banking services.
Asking whether he would consider such a partnership, Blomfield replies:
We wouldn’t,” he responds, “I think it speaks to the different models. We are opening around 60,000 or 70,000 current accounts a month so we can get to scale pretty quickly in the UK on our own. Ultimately, we don’t want to white label our platform to enable someone like Facebook or Amazon to become the interface, we want to be that interface.
“So you can either be the hyper-efficient manufacturer, or you can be that delightful consumer interface.”
Monzo’s commitment to its customers is its strongest quality. Blomfield says that Monzo aims to be that bank for everyone and there is no interest in being bought by traditional banks.
“The plan is not to get bought out by incumbents. We get offers every couple of months but we have the opportunity to build something really amazing that helps millions of people manage their money better and I know one way not to achieve that is to sell to a big bank.
“So we have turned down the offers and I hope we will continue to turn down offers,” he states.
Customer growth
Monzo competes on the grounds of transparency and trust, with a seamless interface and a proactive approach to gathering feedback from customers and developing more innovative services.
The digital bank posts regular blogs and encourages customers to continually advice Blomfield and his team on where they can better improve.
Monzo began the journey of migrating customers from its prepaid card to its upgraded current account in late 2017. Customer growth continues to rise rapidly and the digital bank is acquiring more than just the tech-savvy millennial generation.
Blomfield describes the customer journey:
“There is an adoption cycle. Our early adopters were 92% male. Then you move on to early mainstream and late mainstream. Only 40% of our customer base is in London; 60% is outside but still focused on metropolitan areas. Around 50% of our customers are between the ages of 20 and 30, 25% are between 30 and 40 and a further quarter are upwards of 40.
“Gender balance is about 50/50 now. Around 60% are iOS and 40% Android. We are now moving into segments that are not the natural tech early adopters.”
Already making incredible headway in the early months of 2018, Monzo is certainly one to watch.
