In 2013, the Bank of England scaled back the rules and regulations involved in starting a bank. They hoped to kick-start technological innovation within the banking industry through increasing competition. Companies taking advantage of these changes are aptly labelled as “challenger banks”. Over the last three years there has been new banks springing up across Europe, each proclaiming itself as a digital-first, online-only alternative to the traditional institutions (A recent exception is Metro Bank – Britain’s first high-street bank in 150 years). Each promises a more convenient and transparent banking experience compared to traditional firms. Founded two years ago, Monzo was uniquely mobile-only from the very start. In this talk by Ole Mahrt, Product Manager at Monzo, discusses how this approach can enable a powerful, intelligent banking experience.
Technology Shouldn’t be a Bottleneck
Ole describes the dire state of technology within existing banks in 2012. Making innovate changes was (is?) practically impossible for them due to the mix of several outdated, legacy systems. One example he provides is viewing bank statements online. For some banks this isn’t possible for statements older than 3 months because when online banking started, storing data was expensive and it’s now equally expensive for them to rectify that problem! The majority of an existing bank’s technological costs go into, Ole says, “keeping these big spaghetti ship floating”. (One of my favourite Product Tank talk phrases so far.) This is at the expense of a easy and pleasant user experience.
There are a lot of boring and frustrating procedures within personal banking, such as freezing a card or opening a current account, and that presents an opportunity. Monzo can’t compete with all that these massive institutions can provide, and so instead they take aim at a single target: creating a current account with an unbeatable user experience. Ole’s talk explores in more detail the advantages Monzo has in achieving this aim. For example, mobile technology such as GPS and fingerprint recognition enables innovative security features. There’s no need to tell your bank when you’ll be abroad if your mobile app knows who and where you are. Ole also emphasises the agility of owning their technology stack in the development these features.
Regulations and Legal Hurdles
Despite the Bank of England’s simplifications, acquiring a banking license is still a lengthy process. Add to this the time and complexities involved in doling out physical pre-paid cards, and Monzo could have ruined their customers’ experience through an unsatisfying sign up process. Instead, by utilising their user-orientated mindset, they built an in-app waiting list to keep users engaged. It displayed the number of people ahead of you in the queue and encouraged you to share the app to queue-jump your way to the start. It turned what should have been a frustrating experience into one of the reasons many people signed up to their app in the first place.
Monzo expertly combine the waiting list with other tactics for outreach and community engagement. They have a busy social calendar of talks (this ProductTank included), usually accompanied by card giveaways. They host regular open office events, hackathons and have a publically available roadmap. Everything, including the visual design, is aimed at creating talking points. You can choose to share the cute in-app animations with a friend or spark a conversation with a cashier via the bright neon coloured cards. Monzo not only created a product but also hundreds of thousands of product evangelists. Last year it was these evangelists who enabled them to set the record for the quickest crowdfunding round on Crowdcube. It’s hard to imagine any of the traditional banks inspiring this level of customer passion. Or any passion at all really…