šŸ“° Which is the biggest challenger bank in the UK? - Verdict

Iā€™m assuming that deposits includes any in-credit balances that Monzo current accounts have, I donā€™t think the money has to be in a savings account?

Monzo can loan a portion of those in-credit balances, to earn Net Interest Margin which is why the figure matters.

I didnā€™t know that :eyes: but although itā€™s not 100% like for like, Iā€™d still be interested to see the difference in between the figures.

Iā€™ve tried to check but this is all I get from their signup page :roll_eyes:

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Seems like a pointless comparison to me.

Thatā€™s comparing two different things; a proposition built for deposits, and one thatā€™s more accidental, or a consequence of getting a salary paid in.

Although the figures are impressive (in terms of money spent and sent using Monzo), it does still beg the question of how is Monzo make a decent, sustainable return?

Atom arenā€™t 100% clear about their CA, although itā€™s ā€˜some point in the futureā€™.

Yes I understand that :slight_smile:

Lending deposits will get them closer to break even. While referral fees from the marketplace will earn them the real money.

You hope so, as itā€™s exciting, but itā€™s a really new concept, and we (UK public) arenā€™t the quickest at picking new things up. The negative media coverage of Open Banking et.al isnā€™t going to help either.

Yes I should have acknowledged the fact that I donā€™t know that for sure :slight_smile:

Thereā€™s plenty of reasons to be concerned & plenty of reasons to be optimistic, I guess weā€™ll have to wait & see :crossed_fingers:

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I actually meant to put ā€˜Youā€™dā€™ not, you!

Sounds a bit accusational!

Apologies!

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Question is, can you still consider Atom a challenger bank when BBVA own 30% and consider them one of their acquisitions?

:slightly_smiling_face:

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I never have :slight_smile: & the same goes for Metro bank although theyā€™re a little more similar so itā€™s an apples to oranges comparison. Which is what makes it interesting to me, weā€™re comparing Monzo to a new legacy bank :smile:

If Monzo had more deposits at this point, that would be a positive. If not, then as others have mentioned in this thread, we know why. It just gives a bit of a sense of how the different approaches compare when it comes to this particular measure.

All depends on your definition of a ā€˜challengerā€™! Arguably, if they are to be bought by BBVA, theyā€™re not a bad bank to be owned by; even 11FS have recognised them as such.

The way I see it is that Atom have gone for a less sexy, more traditional route, creating a stable base (albeit with a terrible app) to then build upon. Whereas the whole CA/Opening Banking/marketplace place thing is interesting etc, but is it going to develop at the scale to support Monzo, Starling and the rest?

Banking will change, but not in the short-term, so you need to be around to take advantage!

What do you mean; because itā€™s using traditional products etc??

Mainly because it has the same business model as the legacy banks but also because theyā€™re on an old school technology stack.

But those models make money, thatā€™s kind of my point. Make money, get stable, then have the platform to trial new tech.

Really?? Shocking if they are? What are they using?

This isnā€™t a 100% reliable source but itā€™s the best I can find -

It has created a hefty technology set-up in its run up to the launch: FISā€™s Profile core banking system; FIS/Sungardā€™s Ambit Quantum and Ambit Focus for treasury and risk management; Iressā€™ Mortgage Sales & Origination (MSO) suite for mortgage business, front-to-back office; Wolters Kluwerā€™s OneSumX for regulatory reporting; Intelligent Environments (IE) for front office capabilities; CSCā€™s ConfidentID system for security; Phoebus Software for secured business lending and account servicing for residential lending; and WDS Virtual Agent for customer queries supplied by WDS (a subsidiary of Xerox).

Sure but if youā€™re not changing the business model then youā€™re still exploiting users with things like punitive charges & not fully taking advantage of the opportunities of things like digital & Open Banking.

I doubt they will, I get the impression that they just saw an opportunity to make more money by eliminating branches but for their business to work, they donā€™t need a completely modern stack.


Sorry 'bout the edits, I do that a lot :wink:

That seems a lot for two simple products. Imagine it plays to them wanting to use SaaS instead of building though.

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Perhapsā€¦ My Silicon Valley friends tell me that ā€œSimple Bankā€, once considered an innovative challenger, has stagnated since they were acquired by BBVA. Anecdotal, but Iā€™ve heard that from multiple people.

I mean, for some companies itā€™s probably the way to go. For us, Tom has said on multiple occasions that selling out would be a sign that you are unable to achieve your vision, and I agree with that. It would feel a bit like giving up. I actually discussed it in my job interview - and said Iā€™d have far less interest in the company if I felt being acquired was a more likely outcome than an IPO! :grin:

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This article is daft. :man_facepalming:

Comparing Atom and Monzo makes absolutely no sense, and how can they have Starling in there when they are litteraly writing that they have no idea of figures for themā€¦

Itā€™s basically, we think these are the best, based on our opinion :yum:

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Youā€™re right for some it is, for some it isnā€™t.

I think itā€™s great that youā€™d retain control until IPO, which in itself will be a great achievement.