📰 Monzo 2 years on - the startup threat big banks still "don't get" - The Memo

As you’ve probably guessed from the title, here’s a new interview with Tom

https://www.thememo.com/2017/03/28/monzo-2-years-on-the-startup-threat-big-banks-still-dont-get/

A few highlights

  • £160m spent on Monzo cards to date

  • And then hopefully by end of summer, you will see most people transition across. [to the current accounts]

  • We will have TransferWise (foreign money exchange) plugged in.

  • One of our investors did an awareness study to see how many people knew about all the new startup bank brands and our cumulative awareness was about 1% of the market. And if you actually take people who open accounts that’s like 0.1% of the population.

  • Yes we have had a huge amount of support from the other challengers. Ricky Knox and Ruth Hancock from Tandem provided an incredible amount of advice and support in the early days.

  • Or if money is going to come out in three days time, how we can help with that. [as a feature]

  • [On Brexit] It’s an annoyance and a hindrance I think. I am struggling to see the positives at the moment. And I can point to some clear negatives. It spooked a bunch of investors for sure.
    Secondly, it made many of our existing European staff members very nervous about their future in this country. They don’t feel welcome here anymore. And it’s our ability to recruit new staff.
    And thirdly passporting rights. Our license used to be guaranteed to work across 500 million people in two or three years it’s likely it will only work across the UK’s 65 million or whatever the cut-down version of the UK becomes.

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wow - nice to see the spend tick up from £100m at the end of January this year to £160m in little more than 9 weeks - more people accepting Monzo as their main spend card rather than just testing it out with their £10/week coffee card ?

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I’m intrigued by this

Or if money is going to come out in three days time, how we can help with that…

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My guess is he’s referring to Direct Debits / recurring payments there & perhaps offering overdrafts to cover the cost of the payment…

If anyone can think of potential alternatives, I’d be curious to hear them :slight_smile:

Yeah I was thinking that as well,

It sounds like Direct Debits yes. There is an industry standard for these to take 3 days
Day 1: originator calls on the mandate to pay
Day 2: bank prepares to send the money :moneybag: (at this point it becomes visible on thier ledger)
Day 3: monies are paid.

It would be great for someone to challenge this mantra, as only up to 2013 Standing Orders went in a similar fashion, they now go as Faster Payments. But in the interview To admits that Monzo are still small fish in a big pond.

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I’ve been wondering, has any CEO mentioned anything about how long it would take them to be a threat? I mean at the point of making their startups operational…

With 140k non-paying users they are still way off everyone’s radar. This time next year i think Tom will be at his starting line with 1m customers. Then he can worry about multiplying by 1000x :anguished:

I want to see these shoes

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Do we have any more information on how this might work? I assume you’ll be using their API behind the scenes to facilitate this.

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Not at a great level of detail but we know that TransferWise have an API which exposes the functionality that Monzo needs to build into the app. Starling have done this already, here’s how it looks -

& we know that N26 have an integration too.

I expect Monzo’s integration, which will also be in the app (Tom mentioned this at the open office IIRC), will look / work pretty similarly.

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Interesting, looks smick! So you’ll be able to send money to friends foreign bank accounts?

Yes you will :tada: Though it may have to get to their bank account via a TransferWise account, I’m not 100% sure how that works.

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Sweet!

Now wouldnt it be fantastic Monzo supported multiple FX providers (e.g. an aggregator of sorts) so you could always get the best possible rate?

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It would! I expect they’ll be able to do something like this once their marketplace is launched & they have several suppliers who’re offering their service to Monzo users.

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I’d really like incoming FX at Monzo rates…

Ha! It’s the company that’s initiating the transfer that sets the rates though so you’d have to ask your bank about that :grimacing:

Not if arrived in Euros and Monzo did the FX

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I’m not sure that it’s as simple as it sounds for Monzo to accept payments in Euros (I could be wrong) but once Monzo launches Euro accounts, that could be more feasible…

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