Rethinking the Marketplace / Integration with other services

[Peter_G]

@BritishLibrary

But I think it’s a shame that, in the Monzo universe, “Budgeting” has almost become synonymous with “cutting down costs” or “saving money”, when in reality it could open more doors for more users as “Making a plan for my money”, which is so much more interesting and empowering, IMO.

Yes, exactly this!

Apologies if this sounds a bit pompous, but the words we choose for things often our parameters of thought. That’s why I got a bit caught up over here with terminology about what we call Monzo (and why all new starters at Monzo should have it drummed into them they’re building a finance-hub).

As you say, we need to think carefully about the Budget word. I really like the “making a plan for my money” line instead.

[Peter_G]

@N26throwaway

I’d just like a system, where I’d only need to go through the KYC process once with Monzo, then once done, Monzo can just vouch for me when signing up for something else. I think we’re both thinking of the same thing, just explaining it differently.

Excellent, I think we’re violently agreeing!

It’s really a topic in its own right, but it struck me as one of the things that would be necessary but not sufficient for the sort of thing I was imagining: sophisticated digital identity (or KYC) that could open additional accounts + advanced API with hooks for instant notifications and stuff that’s not in open banking =

[ndrw]

Yes, I really agree, and this is why I want it to be a full financial hub. So it could give me tips - do I pay off my loan first by overpaying, or put the money in a 0.5% interest savings account? How would my finances be impacted if I did one or the other? And so on

[Peter_G]

@Dan5

There is a huge amount of work that goes into onboarding different suppliers, and sometimes we get quite far into the process and for whatever reason it falls through. There are also ongoing commercial relationships to manage, which also take time.

Thanks, Dan - that does sound like a difficult overhead to manage.

I suppose, put another way, I was looking at how to commoditise or take the heat out of all of that from a Monzo perspective. You need to get to a self-sustaining platform (or flourishing garden) without spending all of your time watering the plants. I suppose I was trying to envisage how to get there (and why I thought that savings pots might actually be too deep an integration).

[Peter_G]

@ndrw

Yes, I really agree, and this is why I want it to be a full financial hub. So it could give me tips - do I pay off my loan first by overpaying, or put the money in a 0.5% interest savings account? How would my finances be impacted if I did one or the other? And so on

This is exactly where we need to get to!

The thing I don’t know - and I’m keen for insight on - is when does this approach the FCA definition of financial advice and therefore falls into a different regulation category? I’d worry a bit if that was holding things back - I think as things move on there will need to be a different approach to regulating this sort of thing. It’s important to protect the customer, but also to make sure that regulation remains contemporary.

[Revels]

@BritishLibrary

But I think it’s a shame that, in the Monzo universe, “Budgeting” has almost become synonymous with “cutting down costs” or “saving money”, when in reality it could open more doors for more users as “Making a plan for my money”, which is so much more interesting and empowering, IMO.

It’s easier to spend less. It’s tougher to work out how to spend better.

[BritishLibrary]

I totally agree with your view of ‘constrained thinking’, hadn’t seen your linked comment but that fits the sentiment perfectly.

And if I take it a step further, to my second favourite thing to say about Monzo: Sooner or later, the user base will “mature out” of the offering Monzo has.

There’s a relationship there between the age and needs of it’s Average Consumer^. As the users needs evolve beyond “spending card”, with investment products, mortgages, insurances, etc, I expect a large portion will move away from Monzo to banks with greater connectivity to those offerings.

[davidwalton (Award Winning Hot Coral Analyst)]

I’d like to see the ‘hub’ too.

The founders, at least one of them, wanted the hub as a centre of what Monzo should be. But as becoming a full-on bank took its toll, almost all of them have spun off. And replaced by experienced traditional banking leaders which indirectly introduces legacy baggage and at times it seems like Monzo has already morphed from a disruptor into a, erm…, regular bank.

The back-end tech still stands out as beyond the competition, and with extra innovative thinking, it could deliver what a lot of people need.

I really hope the early groundwork is built on properly to take Monzo forward quickly. Year-in-Monzo is a snapshot of what is possible - make this a real-time forward/backward data-fetch and the framework for forecasting and/or budgeting is possible - especially with Open Banking connections

PS> Thanks @Peter_G for another cracking topic for discussion

[Dan5 (Dan)]

@Peter_G

suppose, put another way, I was looking at how to commoditise or take the heat out of all of that from a Monzo perspective. You need to get to a self-sustaining platform (or flourishing garden) without spending all of your time watering the plants. I suppose I was trying to envisage how to get there (and why I thought that savings pots might actually be too deep an integration).

I think you partially hit the nail on the head with the KYC checks. As I understand it then it’s not possible to just ‘passport’ those checks between one provider to another, at least not easily.

What we might do for our KYC might be different to another provider with a different risk appetite, or might not allow them to come to a sufficient decision. For example say institution X doesn’t do CIFAS checks but institution Y requires them, or institution A does proof of address checks against credit reference agencies but institution B doesn’t like that method and prefers checks against electoral roll then how do you resolve that?

Do you start doing retrospective KYC checks, or does the partnership institution do them? If you do them, then if one customer is outside of the partners risk appetite then does the hosting institution exit their relationship with that customer, or do they just not offer the product?

If they just don’t offer the product, then what do they tell that customer? They can’t tell them they’re too risky for the partner institution, because that could leave them open for an accusation of tipping off. So when the customer complains that some customers get better deals than others

It’s a minefield…

(All the above is theoretical by the way - I can neither confirm nor deny what sort of KYC checks we do )

[Krzysztofp (Krzysztof Dariusz pietryka)]

No good monzo bank no

[aCCount]

@N26throwaway

You’re a real asset to this community and these types of posts spark some real interesting discourse, forming the basis of a sounding board for ideas, many of which go on to sound really appealing.

Absolutely +1 for this

@Peter_G

The Future?

Financial services are becoming commoditised . I think we’ll end up seeing apps that provide the customer experience, then a whole bunch of different savings (and current account) providers. But they’ll be a bit like electricity suppliers - they all do the same thing, so it’s just inertia or cost that keeps you with the same provider.

@Peter_G

What does that all mean to me as a user?

• Basically, you’d have loads of products in the Monzo app that you could open with one click.

This sounds like a mess to me. Why would I want loads of options that all offer the same thing?

The marketplace is only going to be interesting if it offers a range of different products. There’s no appeal in marketplace that offers the same products under 40 different names.

There might be a place for monzo handling the front of house services, and letting other suppliers handle the back end, but - if the back end services are all the same - monzo need only partner with one supplier.

Customers want simplicity, “it just works,” etc. I’m not sure a commoditised marketplace offers that at all.