CYBG scraps Virgin Money digital bank project
As predicted a couple of months ago Clydesdale and Yorkshire Group (CYBG) has ended a project to build a digital bank, following its £1.7m takeover of Virgin Money. Mind you it was hardly surprising given the overlap that would occur.
Back in September a source told me that this was a likely outcome following CYBG’s takeover of Virgin Money. This was because CYBG already has a successful digital banking platform, known as iB which supports the its digital bank B, which has over 200,000 customers.
Virgin had already spent £38m on the digital bank project but it has announced that this will end as well as a contract with 10x Future Technologies which was supporting the project.
10x Future Technologies was set up by former Barclays CEO Antony Jenkins.
A CYBG spokesman said: “10x Future Technologies has been a valuable partner to Virgin Money through its digital journey.
“However, since we first announced our proposed acquisition of Virgin Money we have been clear that we plan to use CYBG’s existing iB technology platform.”
After creating digital banking platform iB, CYBG created its B digital bank. The success of the latter led it to migrate all its brands to the iB platform. This has given customers of Yorkshire and Clydesdale banks the same functionality.
CYBG CIO Fraser Ingram recently told Computer Weekly it was always CYBG’s plan to migrate its traditional banking brands to the iB platform once it was proven through B.
CYBG has already migrated Clydesdale and Yorkshire bank customers to the iB platform and it is likely Virgin will be next.
But unlike the core banking platform change CYBG takes a different approach. Ingram told Computer Weekly that a lot of banks have gone after modernising core banking platforms. “This is very high risk and does not really give you differentiation. To change the back end of a bank when you have got live customers, you have to be sure that what you get will work and will actually give you a point of differentiation.”
“The differentiation comes in how customers access their information and how the bank and customers use this information.”
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