2017 promises exciting developments in digital banking. Many of these will come from new entrants – bringing fresh ideas delivered from powerful core digital platforms. Each will offer customers new ways of banking.
Want to design your own account? Or a lower cost of borrowing? Want a beautiful user interface? You'll get all this and more in 2017.
We've picked some of the standout players who we think will push digital banking forward. For customers, it's going to be a great year...
Singing the praises of Starling Bank
In the final part of our series on digital banks to watch in 2017, we look at the UK. Here Starling Bank's use of digital technology will take the customer-centric approach to a new level, putting it in prime position to lead the way when it fully launches this year, according to Kate Bolton.
The UK is at the forefront of digital banking. For centuries seen as a leading financial hub, London has more recently become an important fintech centre that welcomes innovation and drives change. The regulatory environment is also supportive, with the government and financial services watchdog seeing digital as a way to introduce more competition and strengthen the market. The result: a wave of new banks looking to appeal to modern customers who view the world, including their bank account, through their mobile phone.
There are plenty of digital banks doing great things – Atom, Monzo (formerly Mondo) and Tandem all come to mind. But Starling is the standout for me, and the one I have come to know well: both as a pre-launch beta customer, and through my collaboration with them on the banking industry initiative, Comms for Good.
Founded by banking veteran Anne Boden after time out in fintech, Starling received its banking licence last year and is set to launch any day. It is currently only operating alpha accounts, but the philosophy, infrastructure and talent embodied within make it one to watch.
Its one-account approach is designed to make life simpler – only one set of terms and conditions, for example. And at the heart of its sales pitch is that the account is pretty much totally configurable by the account holder. All their cash is kept in one place, but the digital platform allows the customer to earmark it for holidays or tax, for example. They will be able to set the parameters and insights that the technology affords them. It really does put the customer at the centre.
It's sticky too. Even at the beta testing stage it's got me hooked in a way I would not have expected. I actually enjoy seeing my transactions pop up on my phone, and I have started to think twice about buying that extra coffee or lunch out, knowing the app won't let me forget it!
Boden has described the structure of the technology stack that Starling uses as like a cake – with the mobile app being the icing. Each stack is critical to the overall success, but what attracts customers is the look of the thing – the icing.
The bank is using the technology in the most natural way – to deliver what the customer wants. This is what will set it apart from the pack. And if it helps others stay in control of their money, it's got my vote.