Monzo, the British neobank, this week announced an integration with one of the world’s largest automation platforms, IFTTT. Their objective is to give customers the freedom to build their own integrated services, bringing together their devices, apps and financial data.  For example, customers will be able to reward themselves every time they visit the gym or track their calories with every soy skinny vanilla latte purchase. So, does this herald a new age of personalised banking? Has the Internet of Things (IOT) finally come of age for retail banking?

This is a really clever idea for Monzo. So far the use of IOT has largely been limited to bank defined applications. For example, enabling banking apps on wearable devices (think of Bank of America FitPay), or beacon technology to identify customers and unlock 24-hour ATM lobbies (think Citi and Gimbal beacons in the US) or even banking via virtual assistants, like Alexa. The Monzo brand appeals to financially savvy, digitally aware customers. The kind of customisation capability offered by IFTTT is new in banking. It is likely to appeal to these customers. This is great brand marketing and it reinforces Monzo’s deserved reputation for vision and innovation.

At the same time, it probably won’t have been an expensive change for the bank to make. They probably already expose much of the necessary data. They join IFTTT ecosystem as one of only 11 financial services and payments services. This combination gives Monzo customers the chance to compose their own services, that will in turn let the bank learn what new features customers want. This will be invaluable feedback for the future development roadmap. It’s likely Monzo will also learn more about their customers needs and preferences, enabling them to target ads and products more effectively.

This is also directionally a clever thing to do. As more and more devices become able to connect via IOT, there will be more and more compelling cases for doing so. As greater numbers of customer use these services, the interfaces will become more mainstream and it will get easier and easier to create these applets. That will encourage more customers to use similar services. 

For today, whilst it looks good, it’s not transformational yet. The value propositions are ‘nice to have’ for the time being. But then, transformational is an unfair yardstick at this stage. This is a cool thing to have done. I think it will set the tone for other banks and I’m sure we’ll see much more of this in the future. IOT’s time is coming.

What do you think?