Monzo chief: Trend only going one way, people want more digital banking

The UK digital bank has officially launched in Ireland with 100,000 on its wait list

Chief executive of Monzo Europe, Michael Carney: 'Our strength is that we own our own tech.'

"The trend is only going one way, people want more digital banking,” the chief executive of Monzo Europe has said, adding that they offer a "differentiated experience” that traditional banks would find "very hard to replicate”.

On Tuesday, the UK digital bank launched in Ireland with 100,000 people signing up to its wait list in advance of its full roll-out. This marks its first expansion into Europe after securing a full banking licence from the Central Bank of Ireland four months ago.

Monzo said it will offer free personal and business banking for everyone.

Speaking to the Irish Examiner, chief executive of Monzo’s European operations Michael Carney said the sign-up on the wait list has been phenomenal and shows there is a “gap in the market for a new bank”.

Mr Carney said: "Our strength is that we own our own tech. We build our own tech and our engineering team is phenomenal. They are excellent and if there's an issue with the app or we want to improve something, we can do it the same day and it can be updated and it'll be better for everyone. 

I think that's really challenging for a traditional bank to try and replicate that.

"The question is, can the digital banks grow fast enough while the traditional banks try and evolve to be able to compete on the digital offering which everyone wants? I think that's the big sort of competitive environment that's playing out.

"I believe that the digital banks are sort of structurally designed so that they can deliver a differentiated experience that would be very hard to replicate from a traditional banks perspective.” 

Monzo was started in 2015 and boasts 15 million personal banking users in the UK and 800,000 business customers.

On the personal account side of the company, Mr Carney said people can sign up for their own accounts, joint accounts, as well as kids accounts — all of which will be free.

The Monzo app will also allow for savings accounts with interest rates of 1.6%. All Monzo accounts are protected up to €100,000 under the Deposit Guarantee Scheme.

“A lot of the features that you would have in a money management app are actually inbuilt and native to Monzo, things like pots for sorting your money. We have a salary sorter, so as your money comes in, you can automatically allocate it to various different savings that you want to put in other accounts, etc,” Mr Carney said.

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On the business side, Mr Carney said their systems allow companies to reduce the time they spend on financial administration.

"We've lots of features built into our product, like automated tax pots, so as your revenue comes a proportion will go to tax, so that you don't have that worry. We've got invoicing built into the app and automatically follows up if it is not paid,” he said.

The company is entering a market dominated by just a few pillar banks as well as entering into direct competition with Revolut which has a strong foothold across Ireland.

Monzo is basing its European headquarters in Dublin. In December it had 35 employees with plans to double that.

Mr Carney said their strategy is to offer customers a “differentiated experience” and “let that talk for itself when people start using it”.

"We don't need to, on day one, have people bring their salaries, but what we want is to build a relationship with people so that we can solve more and more their needs and that's ultimately the longer-term play,” he said.