Monzo and Starling have been poaching customers from major high street banks - Business Insider

  • 📰 BusinessInsider
  • ⏱ Reading Time:
  • 78 sec. here
  • 3 min. at publisher
  • 📊 Quality Score:
  • News: 35%
  • Publisher: 51%

Nigeria News News

Nigeria Nigeria Latest News,Nigeria Nigeria Headlines

Monzo and Starling's spike in account switchers has grown over the last 5 quarters – suggesting the they're developing a strong reputation:

In Q3 2019, Monzo and Starling gained 13,453 and 6,686 net current account customers, respectively, while several major banks reported negative numbers, including Halifax , Barclays , Lloyds , and RBS . But the news hasn't been all bad for incumbents, as Nationwide added 26,466 customers and HSBC gained 15,782.

The neobanks' spike in account switchers has been growing stronger over the last five quarters. In Q3 2018, Monzo gained 2,702 customers, while Starling added 1,737 — and the number of account switchers gravitating toward each neobank has increased in each subsequent quarter up to now.

The incumbent banks that are adding customers may be doing so by luring them in with cash incentives. While most incumbents are losing account switchers, HSBC and is adding customers, as is NatWest, which gained a net 37,663 current accounts through Cass between January and September this year, according to Cass figures One thing both banks have is common is that they've been offering cash bonuses to customers who switch to using their accounts — as much as £175 in NatWest's case.

However, using bribes to draw new account holders is costly and is likely to pull in customers with low brand loyalty. Paying $225 per customer is certain to damage profit margins and is likely a strategy that only large incumbents like HSBC or NatWest can undertake for any serious amount of time. A severe risk, however, is that if customers can be simply lured away by a cash incentive, they may not be likely to stick around with any one bank long enough to be worth the cost. And given that there are services like Cass in the UK that make it easy for consumers to switch their current accounts, customers with little loyalty to their bank have few obstacles to stop them from hopping to a different bank offering a better promotion.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 729. in NG

Nigeria Nigeria Latest News, Nigeria Nigeria Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

WOMEN-OWNED-BUSINESS MONTH: Women entrepreneurs share their top tips and strategies for running their companies, and how to be a successful leaderBusiness Insider profiled female entrepreneurs, interviewed experts, and reviewed research highlighting major opportunities and challenges. How is this not discriminatory? Are they actively keeping out men? Since all are woman, it would seem so. These are just a bunch of hypocrites and should be reported to the law. Good info. If you need more data I did this video: Good info. If you need more data I did this video:
Source: BusinessInsider - 🏆 729. / 51 Read more »

AT&T lost nearly 1.4 million TV customers in Q3 - Business InsiderAT&T promised to make'no major acquisitions' through 2022 and announced a three-year capital allocation plan. 1M fans have been asking em & WB for these.
Source: BusinessInsider - 🏆 729. / 51 Read more »

S&P 500 propelled to record high by strong earnings season - Business InsiderThe S&P 500, Nasdaq composite, and Dow Jones industrial average all rose during US trading on Monday.
Source: BusinessInsider - 🏆 729. / 51 Read more »

HSBC CFO says to expect 'material action' against struggling business unitsThe bank is looking at ways to reshape its non-ring-fenced bank in the United Kingdom and its U.S. business, HSBC Group CFO Ewen Stevenson said.
Source: CNBC - 🏆 12. / 72 Read more »