The 'dinosaurs' of the banking establishment - lumbered with antiquated technology systems and ruinously expensive branches - will be brushed aside by nimble, mobile-led competitors says Anthony Thomson in a hard-hitting speech ahead of the launch of his digital-only challenger Atom Bank.
Thomson's ferocious assault on the traditional banking system comes as Atom Bank, built from the ground up to handle customer interactions from end-to-end in a purely digital format, prepares to welcome its first customers in December.
The former Metro Bank chairman pulled no punches in his talk at the Centaur festival of Marketing at London's Tobacco Dock.
"Banks are mired in the legacy of old IT systems that are bad," he told his audience. "The first automated banking system was introduced by Coutts in 1967. The joke is that they are still running on it today.
"Banks are trying to be cool and hip and build super cool digital front ends and say they will compete with Atom. But it’s like putting lipstick on a pig - ultimately it’s still a pig and the new front end is still running into an awful digital back end."
He says that Atom Bank will break the mold, taking a "telepathic" approach to anticipating and meeting customer needs. As an example he points to the use of behavioral tracking to provide customers with bank statements two months in advance based on past spending patterns.
"Why would I start a bank?" he asks. "Nobody likes banks or bankers. I’m not a banker; I’m a marketer and entrepreneur. Banks are mired in the legacy of real estate, of branches in places nobody goes, and none in places they want to be, because we don’t want banks in shopping malls, we want nice shops."
With no real estate overhead, nor massive maintenance spend on legacy IT systems, Thomson says Atom Bank intends to grow into a £5 billion balance sheet business in five years with just 340 full time staff.
"Metro has that size balance sheet with 2200 people," he says. "So yes this is a realistic issue for banks."