Perhaps I am biased, but I’ve noticed London is getting very busy with FinTech these days. Just yesterday I had a chance to meet and greet a bunch of people from Starling Bank. Including their brilliant CEO, Anne Boden. The evening was lined with drinks and lovely hors d’oeuvres, and punctuated with a gripping speech by Anne herself. She spoke about her idea that started Starling Bank, and how banking should be more human. It spoke to me, and being a woman in tech working with mobile apps, I am excited to see so much happening in this space. It is always exciting to run in to Ghela Boskovich, so for that reason alone I wasn’t going to miss this FemTechLeaders meet-up.
— Ghela Boskovich (@GhelaBoskovich) November 16, 2016
Starling is in good company
Not even 12 hours after getting to know Starling, I received an email from Zopa announcing their plans to build a bank themselves. If you’ve seen my post about Zopa some time ago, you know that they are known for Peer-to-Peer lending. To complete my recent adventures, and news for FinTech in London, I got to attend a great talk by Hugo Cornejo, head of design at Monzo. He was my favourite speaker at JAM, and did a fantastic job of showing what sets Monzo apart from traditional banks.
So, is everyone building a bank these days? Coming from Toronto, I’ve come from one big finance city to the mammoth that is London. Combine this local ‘strength’ in banking with a continuously growing tech scene, and it is not surprising London is a backdrop for innovation in FinTech at the moment. As Anne put it last night “nobody starts a bank”. This was true for a long time, and I am happy to see that it isn’t entirely black and white anymore. Some clever people are taking a stab at changing how we manage and use our money. Perhaps seeing a number of FinTech developments all together, within a short period of time, could make me feel a bit like new banks are popping up everywhere. One thing that is preventing this from being an actual fact is the long process it takes to receive a banking license. Anne was telling us that she started Starling a few years ago, and only now have they received their final approvals. Banking is one of those industries that never moved at an agile pace, but infusing tech and some great new ideas into it might make this change in the future!
More about Monzo
Monzo is trying to build the best current (a.k.a. “chequing”) account with clever reporting on your phone. I will say, I love their approach of categorising your spending so you can see at a glance how much you’ve spent on eating out last month, vs groceries. I am sure most of us can use this type of wake-up call to better understand how we are (mis)spending our money. Starling Bank is trying to do something similar, but tie your day to day banking in with your financial goals. Their app is not out yet, so keep an eye out for an update later when I get to have a play with it. One fun thing about the Starling Bank meet-ups is that you can sign up for your own bank account, and choose your account number. I was able to get a super easy to remember, symmetrical, series of lucky numbers! It gives serious feel good vibes, and a nice perk as an early adopter.
Am I going to be an early adopter?
My financial life is still very much tied to one of the big ‘traditional’ banks. I hate my bank’s mobile app and never use it, because it embodies what I consider to be quintessential bad UX. New players like Monzo and Starling may quite easily persuade me to make a full switch if they are able to compete on some of the services I need to organise my rather international life. Introducing some sort of a loyalty scheme would also not hurt. Points are not what they used to be, but they still add up and I try not to spend a penny without trying to get some credit card points in the process. For me to use a current account only for day to day small payments, and give up my credit card, is unlikely to happen unless there are substantial benefits that outweigh the points I accumulate with MasterCard. Nevertheless, I am excited to try out my new Starling account, and at JAM I was one of the lucky people who was able to get a Monzo card as well. I may end up with more accounts than money to put in them, but I am excited to take both for a spin (great excuse to go shopping, isn’t it?). One thing already working in Starling’s favour is the fact that I love my new bank account number, and Monzo still works more like a prepaid credit card instead of a full fledged current account. Once Zopa makes a move in this space, it will be interesting to see what they come up with as well. Their direct benefit is without question a build-in audience through their peer lending customers. It would not surprise me if some of those customers would like to consolidate their borrowing/investment activity with a current account. That alone won’t cut it, so let’s see what other ideas they cook up.
The future is bright!
Both Monzo and Starling want to build the best current account ever. It will be very interesting to see how the two approach this. Ultimately, what works for one person doesn’t work for another. If they play their (bank)cards right, both players could speak to a unique subset of people who share similar banking needs and preferences.