One of the newest entrants to the increasingly crowded digital banking space in the UK has announced it is currently awaiting approval from the Bank of England after securing £2 ($3.15) million in funding from Passion Capital. Led by Tom Blomfield, a co-founder of fintech startup GoCardless and Gary Dolman, Paul Rippon and Jason Bates, Mondo’s creation was born out of leaving similar digital bank outfit, Starling Bank.
Today, Mondo has been testing its prototype prepaid smartphone account, with accompanying debit card and PFM (Personal Financial Management) features but after raising money, the bank needs to get to the regulatory capital requirements. Commenting on this in TechCrunch, Blomfield said
“Passion Capital have invested £2 million, and we’ll be looking to raise around £15-20 million before our full launch — this will be dictated by the Bank of England’s regulatory capital requirements.” He continued, “Thanks to EU single-market rules, we can passport this licence across Europe, although we’ll focus on getting the UK right first.”
While regulators were hoping for increased competition in the UK retail banking space, the unprecedented number of new entrants must come as a surprise and though Mondo and other similar digital banks can point to increasing mobile banking and payment use, there is no doubt they face uphill battle to attract consumers away from the major high-street banks.
Overview by Tristan Hugo-Webb, Associate Director, Global Payments Advisory Service at Mercator Advisory Group
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