Monzo vs the Retail Banks - Analysis from Orange Digital Ventures

[alexs (Alex Sherwood)]

@AndyL

I think the Tech Giants are perfectly placed to bring innovation to the retail banking market if they choose to do so (see Apple Pay as a great example)

That’s a good point.

@AndyL

I would also argue that some of the large incumbent banks will disrupt themselves (and their associated value chains and business models) to bring innovation to the market.

They’ll try but…

@alexs

The whole reason why Monzo exists, is because the legacy banks can’t build this functionality on top of their existing systems, if they could (& perhaps had more desire) they would have created Monzo already. This talk is pretty techy but Simon does a good job of explaining just how archaic some of those systems are here.

Tom has pointed out that they’re earning a lot of revenue from things like punitive charges too. We’ve seen Lloyds move away from those but it might put people off using their overdrafts now. So to disrupt their business model, the banks will have to take a loss in the short term & that’s very hard to do if you’re a public company & have a large cost base etc. Tom does a much better job of explaining the challenge than me of course, at 16:39 in this podcast, for example.