Challenger bank Monzo is testing out a new feature enabling customers to easily move money from other banks’ accounts, despite founder Tom Blomfield’s previous scepticism of open banking.
Blomfield, who announced he would step down as CEO in May and into a new role as president of the neobank, said earlier this year that the “positive effect of open banking on innovation has been nil,” when speaking with The Telegraph.
“I don’t see any businesses based on open banking in Europe whatsoever,” he said, despite open banking rules officially being introduced into the EU’s FinTech landscape in 2018.
Nevertheless, it seems as if Monzo has not let his pessimism prevent the venture from trying out a new open banking feature.
The new feature would essentially make it easier for the neobank’s customers to transfer funds from an account at another bank into their Monzo account without having to remember bank logins.
The easy bank transfer feature uses Faster Payments, the secure payments network that powers bank transfers in the UK.
The bank is now inviting customers to try out the new feature.
“We’re looking for your feedback to help us iron out any issues, and to make sure it’s ready to bring out to everyone in a couple of weeks,” Monzo said in a blog. “We’ll also be on hand to answer any questions you might have about how it works.”
This is the latest twist in a year that has proven particularly eventful for Monzo. It started on an optimistic note with Monzo announcing that it would look to hire 500 new employees and take another crack at its failed premium account offering as well as applying for a banking licence with the US Office of the Comptroller of the Currency.
Then the coroconavirus pandemic broke out, seeing Monzo join other European challenger banks to quickly allow their colleagues to work from home to protect them from the contagion. This didn’t prevent rumours to spread at the end of March that Monzo and its UK rival Revolut were about to go bust. Both startups were quick to deny that those claims had any merit.
Nevertheless, Monzo has since had to close its Las Vegas office and let go the 165 staff members who worked there. In the UK, it has reportedly furloughed 295 staff members.
In a sign of solidarity with affected workers, Blomfield said at the end of March that he would not take out any salary for the next 12 months. At the same time, the digital bank announced that the board and other employees had decided to take a 25% pay cut.
Still, the bank said it was going to make a further 120 of its employees redundant in June.
In June the bank reportedly suffered a down round, resulting in its valuation dropping down from $2bn to $1.24bn.
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