The man behind Metro Bank and Atom Bank is working with banking software maker Fiserv to create a retail banking...
IT platform for entrants in the sector.
The software as a service (SaaS) IT platform, known as Agiliti, is an attempt to reduce the costs and risks associated with the heaving regulated retail banking sector. Customers will build the platform in a modular fashion and banks will only pay for what they use. The software and infrastructure offering is dedicated solely to the UK banking market.
The pay as you go financing model, alongside the short time it takes to set up such a system, is a major draw for businesses attempting to enter the banking sector.
"Technology is the last major barrier for new entrants to financial services, and Agiliti is offering them a way to overcome it. New entrants in particular benefit from the fact that the business model allows them to align costs with business success," said Anthony Thomson.
"Additionally, a technology solution that could have previously taken two to three years to build could now be implemented in as little as six months with Agiliti.”
Regulators are keen to increase competition in the banking sector. The Payments Council introduced a service that enabled consumers, small businesses and charities to change current account providers within seven days rather than the 30 days it took previously.
Consumers are demanding choice. Recent IT failures at big banks have damaged reputations of traditional banks. The credit crunch also reduced customer confidence in traditional banks.
The system is aimed at new entrants and existing banks and offers the opportunity to deliver retail and SME banking products.
Thomson said it is the equivalent of leasing a car for banks: "Agiliti offers banks the IT equivalent of leasing a new car, with a newer model provided whenever it's launched. This is the next phase of the banking revolution, which should bring greater competition and choice for consumers.
"We expect a significant number of new banks to open in the UK within the next three years, and Agiliti is ready to help them get up and running quickly, with an economic model that makes good business sense."
Think Money Limited has already selected Agiliti for its IT operations. The Manchester-based firm enables consumers to establish personal current accounts with unique functionality for personal financial management, and also offers a comprehensive mortgage and insurance comparison service.
"Think Money needed a new solution capable of meeting its needs for rapid product evolution and speedy introduction of new products,” said Michael Aldred, managing director at the finance firm.
Fiserv has established a wholly-owned subsidiary, Fiserv Financial Service Technologies Limited, to provide Agiliti to the UK market and Thomson will serve as a non-executive director.
In 2010 Thomson was co-founder of Metro Bank, the first banking organisation to open in the UK since the end of the 19th century. He is currently establishing a digital only organisation known as Atom bank, which will open next year.