Monzo fends off suitors as current account upgrade begins
10 October 2017 | 9504 views | 0
With big tech firms and banks lining up at its door to talk about a potential acquisition, digital challenger Monzo is pressing ahead with the opening of its current account service, inviting all existing users of its pre-paid card to upgrade and opening a waiting list for new applicants.
The UK startup says the account has been tested with 18,000 users and the switchover for existing customers will take place over the next eight weeks.
Monzo customers will have to agree to new terms and conditions and wait in line for a new debit card which, once activated, will automatically move account data and balance from the prepaid card to the current account.
Monzo claims to have attracted 450,000 signups for its prepaid card, blowing past its early expectations. The app-only startup says it is being been regularly approached by big tech companies and banks interested in engaging in "big money" take over talks.
Speaking on City AM's Unregulated Podcast, Monzo chief Tom Bloomfield says: “Those kinds of acquisitions never really go well… They always say, ‘we’ll help you... realise your potential much much faster’.
“And it’s like, well yes. Or you’ll stick us in a basement and we’ll rot away and die because frankly you don’t really want to disrupt your own business models that much. Certainly not as much as we do. So let’s see you in 10 year’s time.”
Talking about Monzo's well-publicised technical problems in recent months - from loss of service from a third party processor to running out of card stocks following a supplier mixup - Bloomfield says the bank's frankness and transparency in explaining the problems to users has piqued the interest of prospective customers.
“The press we got [after its 12-hour outage over the summer] was phenomenal,” he says. “Newspapers wrote about how we’d handled it and actually built trust and transparency. We had one of our biggest days of sign-ups the next day.”ssues.