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"Transaction not done through human presence"

Internet/mobile/phone/ATM

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Valued at more than $1billion

Raised £20m in crowdfunding

Focus on innovation, Product development & customer engagement fuelling growth

Has more than 2.2m users

Adding more than 100,000 customers a month

550 employees

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Digital banking to cross $9 trillion by 2022

2/3 of banking customers say they plan to convert fully to a digital bank

Just over 1 in 10 brits (12%) fully switched to a digital-only bank

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Capital availability due to economic recession or upswing

Spending habits (Monzo)

Interest rates

FDI

Exchange rates (Monzo)

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3 Main trends

In a study 39% say they prefer to do banking via an app

Prefer omnichannel experience that emerging technology is enabling

Less cash payments or deposits (cashless society)

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Simplification
-User experience
-Functionality
-Language
Convergence of Physical & Digital Experiences
-Audio, video-chat and co-browsing solutions integrated
-Digitization of branch experiences
Lifestyle Banking
-Focuses on delivering non-financial experiences to customers that help enhance their life e.g. help to buy home apps

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Comparison of the Top 3: Monzo/Revolut/Starling

3 Areas of Comparison:
-Travelling
-Saving
-As a Current Account

Direct competitors (challenger banks): Revolut & Starling

Indirect competitors (legacy banks): Lloyds & Barclays

https://www.finder.com/uk/revolut-vs-monzo-vs-starling

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No physical presence (brick & mortar). Purely digital services

Instant notifications for your spending, with payments removed immediately from your bank balance so it's always accurate

Monzo also includes easy ways to send money to friends who also who also use the service

https://www.youtube.com/watch?v=99i3Y_Y44kY

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Place (mobiles)
Price (free of charge app) £5 referral
Promotion (community meet-ups, hackathons & word of mouth)
Physical evidence (debit card)
People (few departments)
Product (banking service)
Process (innovation focus)

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Threat of New Entrants:
V. high - due to nature of industry e.g. Starling
Threat of Substitutes:
Low - unless extreme technological change
Bargaining Power of Buyers:
High - users can easily switch not dependant on proximity to branch (traditional banks)
Bargaining Power of Suppliers:
N/A
Rivalry Among Existing Competitors:
V. high - all offer similar services

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Strengths:
Fast paced innovation
Weaknesses:
Offering too many features can reduce simplification
Opportunties:
5G connectivity will improve speed and keep less data on apps - improved security
Threats:
Competitors catching up on current features (no patent available or copyright)

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Monzo sees innovation as key & releases new features every week

Delivers a better customer experience

Provides superior product features

Provide a better value proposition

Excellent marketing

Creates affinity among consumers

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Monzo cards will have contactless which many US banks do not support

There is a bank called Simple which is a potential competitor

Needs to obtain a US banking license