Koto is set to launch in the UK in January next year offering fixed-fee lending via an app.
The business shares co-founders with Ukraine’s popular neo-bank, monobank, and aims to replicate the latter’s success.
monobank gained more than 1.6 million customers in just over a year after its launch and is continuing to gain more than 100,000 customers every month, according to Rob Escott, chief executive officer at Koto (pictured above), in an exclusive interview with Specialist Banking.
“We want to replicate the sort of disruption that monobank has created in Ukraine,” said Rob.
“monobank launched last year and it took them just nine months to launch … and since [launching, it has] now got 1.6 million customers in a bit more than a year.”
Misha Rogalskiy co-founded monobank — a joint venture with Ukraine-based Universal Bank — and is also co-founder of Koto.
Rob stated that Koto wants to launch with something that “generally helps customers to manage their everyday lives”.
He explained that customers will be able to apply for credit exclusively through the app, and therefore will not need to apply online or use paper forms.
“You'll get your card straightaway … with a Mastercard number [as well as] a sort code and account number.
“You don’t have to wait for anything in the post, [which] is quite different [compared with] most providers.”
Koto is made up of three products: an e-money account plus two credit elements which have fixed fees of just 25p or £10.
“The first [credit product] — called extra — is up to £400 and works a bit like an overdraft, but unlike an overdraft there's no interest on it — it's a fixed fee for usage.
“…It's very transparent, very fair and everyone can understand what it is.
Rob added that there won’t be any foreign transaction fees or fees for withdrawing cash from an ATM.
The other credit product — called a ‘spread facility’ — is up to £1,000 and is generally for larger transactions, with a fixed cost of £10 a month.
“The technology stack is rock solid because we're sat on something that's proven for 1.6 million customers,” Rob concluded.
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
Rigour builds resilience
There is a relentless flow of new technologies and development methodologies unfolding on many fronts in the financial services arena...
Enhancing offerings to SMEs with the use of technology
Small- and medium-sized enterprises (SMEs) make up a significant proportion of British businesses...
New digital bank Vive receives banking licence
New digital bank Vive has received its UK banking licence with restrictions from the Bank of England...
Aldermore names Damian Thompson as new group MD for retail finance
Aldermore has named Damian Thompson (pictured above) as its new group managing director for retail finance, subject to regulatory approval...
Tink closes €90m investment round
Tink has completed a €90m (approximately £76.8m) investment round — its largest funding to date — to support its European expansion...
Step back from the hype: what can AI realistically deliver in 2020?
While talk of artificial intelligence (AI) in financial services generates great excitement, it’s important not to get too carried away and caught up in overly ambitious uses of the technology...
Temenos launches microservices architecture tool for large banks
Banking software company Temenos has launched Temenos Transact — a microservices-based architecture tool designed for large banks...
Starling Bank enhances product offering for SMEs
Starling Bank has enhanced its product offering for businesses and sole traders with a range of new features...
2020 vision: Open Banking is open for business
Last year was a major one for Open Banking. September’s PSD2 deadline encouraged banks to accelerate their efforts to become compliant, and while the nuts and bolts of the technology did pose a challenge, the opportunity for both banks and third-party providers (TPPs) has finally come to light...
FCA calls for easy access cash savings reform
The FCA has proposed to reform the easy access cash savings market...
HTB launches new 30-year, interest-only loans
Hampshire Trust Bank (HTB) specialist mortgages division has launched 30-year, interest-only loans...