Seems like a particularly poor article. The title is an unsubstantiated claim based on the author's passion project, rather than any sort of real analysis. Ok, so banks do loss-leaders and cross sell. SO does your supermarket, payroll provider, and many, many other businesses. Yes, that means that the things they cross sell will be more expensive because they have to subsidize other parts of the business - but without that entry point to the customer, they'd be paying google and all sort of other marketing companies to deliver customers for each segment of the business - and they'd have to overcharge to fund that marketing as well.<p>Or if the argument is that he plans to charge fairly for each bit of the ecosystem, he's about to learn some hard lessons in strategy.<p>To the author: I hope everything works out for you - but do some research first; you're underestimating your competition.
Only, Mondo isn't even a bank, yet. From the FAQ [1], "your money will be held in a separate, protected account by Wirecard, our issuing bank".<p>As Matt Levine keeps pointing out [2], "Tech businesses trying to disrupt finance tend to think that they are solving a technical or data or customer service problem, but the problems of finance are always and everywhere regulatory problems."<p>[1] <a href="https://getmondo.co.uk/faq/" rel="nofollow">https://getmondo.co.uk/faq/</a>
[2] <a href="http://www.bloombergview.com/articles/2015-06-19/bitcoin-bucket-shop-kicks-bucket" rel="nofollow">http://www.bloombergview.com/articles/2015-06-19/bitcoin-buc...</a>
"If you have some money left over at the end of the month, imagine being able to move it into a P2P lending platform with one click."<p>The last time people in the UK went looking for better interest rate on their savings they found online Icelandic banks. They put large sums of money into them (even local governments!). They apparently didn't consider that there was a reason these banks were paying higher rates than their local banks. When the banks went under and the resulting shortfall was greater than the entire GDP of Iceland, they were furious and demanded their own government "do something about it". The resulting bailout of speculators ended up costing the Treasury billions of pounds.<p>So I don't think the taxpayers of the UK should be all that thrilled by the brave new world of being able to move money into P2P lending schemes with one click.
"If you have some money left over at the end of the month, imagine being able to move it into a P2P lending platform with one click. Or being able to choose a mortgage from any one of a number of providers based on your previous spending habits and income."<p>Keep imagining. I've been working on UK mortgage software for the last few months, and it's stone age. I'm talking interfacing with a Fujitsu VME mainframe stoneage.
so if Mondo's going to only provide a current account: what are they going to do with their customer's deposits? just leave them sit as cash doing nothing?<p>a bank that cross sells will use the revenue from lending to ruthlessly undercut this newcomer.<p>banks are big as the size of the balance sheet allows mind boggling economies of scale.<p>existing banks are probably also able to hire a team of 10 good app developers to put together a high quality app, if they thought the demand was there...
I thought it was going to be an article about how p2p lending was going to take over everything: car loans, mortgages, payday, equipment finance, small business loans, merchant cash advance, factoring, debt collection, credit cards, pawn shops.
The title is right.<p>PSD2 / XS2A are forcing the big UK banks to offer APIs. This is good, but will mean a current account will essentially stay the same, and startups will build the services around this.<p>Mondo is already setup perfectly for this and has the early advantage, but startups build for users, and the users are with the big banks. I expect challenger banks to challenge, but in 10 years the big banks will have some incredible integrations which have been gifted to their customers , making them stay.
The only real alternative to a UK bank that has actually launched and actually works is Monese. 20,000+ app installs in under 4 months since launch and an active community of users <a href="http://www.facebook.com/mymonese" rel="nofollow">http://www.facebook.com/mymonese</a> <a href="http://www.twitter.com/mymonese" rel="nofollow">http://www.twitter.com/mymonese</a> with plenty of reviews to read here <a href="https://play.google.com/store/apps/details?id=com.monese.monese.live&hl=en_GB" rel="nofollow">https://play.google.com/store/apps/details?id=com.monese.mon...</a> Euro accounts will also be landing this year, and transfers to a range of European currencies are supported at just 0.5% !! Plus the account is currently free !!!!
He mentions TransferWise and Azimo. Does anyone have experience with Azimo, maybe to compare to TransferWise?<p>I'm very happy with the rates and transparency of TransferWise [1], and Azimo seems to do something similar but it isn't very clear how they work or what their vague claim of "best rates" means (it's not like they're the only ones that claim that).<p>[1] If you want to try it, with an invitation link you get your first transfer of up to £3000 for free, here's mine: <a href="https://transferwise.com/u/5d78" rel="nofollow">https://transferwise.com/u/5d78</a>