NatWest recently revealed the launch of a pilot programme which will allow customers to bank using just their voice.
The bank claimed that it could mark the beginning of a major change to how customers manage their finances and said that this was just one of a number of services it was developing this year to better serve its customers.
With major banks innovating with new technology, Specialist Banking set out to discover what specialist banks had planned next to further revolutionise the sector.
Mortgages with updated credit scoring
Tandem Bank is currently working on a mortgage product that it claims could be a “gamechanger” in the industry.
It plans to offer competitive mortgages that will offer a fresh approach to identifying trustworthy borrowers, with a new method of credit scoring that allows for a fuller picture of how each applicant spends, saves and borrows.
“This new innovation is needed because the mortgage industry in its current state is only serving a very specific group,” said Sven Schindele, banking products director at Tandem.
“The way people work, live and spend is changing and we need a mortgage offer that changes with its customer.
“While the credit bureau structure works for some, the hard pass or fail format of checks based on only a few touchpoints doesn’t take into account someone’s full financial situation.
“New digital banks have access to a wealth of financial data which could transform the mortgage application process, offering a solution for those currently underserved by the incumbents.”
Chetwood Financial focuses on using customer data to make dynamic lending products and is looking to use real-time data to improve the way it serves its customers.
Its LiveLend Reward Loan monitors a customer’s credit score and reduces its rate at three-month intervals as the risk of the loan improves.
The bank believes there are many ways in which products can be more dynamic in the future.
Julia McColl, commercial director at Chetwood Financial, said: “We develop products that allow customers to get a quote with no impact on their credit score and encourage them to shop around for the best offer.
“We're looking to do something different with our products, by tailoring our services to meet the needs of those using them.
“By building unique, dynamic products that adjust to our customers and their needs we hope to make engaging with personal finances easier than ever before.”
Financial literacy for children
Revolut is planning to launch Revolut Youth in a few months’ time, a service aimed at improving the financial literacy of children and teenagers.
Customers will be able to add their children to their account as a secondary user.
Children will be able to choose their own card and start using Revolut’s current account and money management platform through the app, while teenagers will have access to another version of the feature.
George Robson, product owner for premium at Revolut, said: “We believe that taking control over your finances is a lifetime of work and starting to learn about financial literacy and how to manage your money is vital from a young age.
“The long-term goal is focused on promoting financial literacy and allowing children to earn the trust to have more financial freedom.
“We are also aiming for the app to meet the United Nation’s development standards for financial literacy.”
Back to basics
Jonathan Thompson, founder and CEO at B-North, mentioned that it was planning to innovate in 2020 by bringing real, skilled SME lending bankers to the front line of its business.
“In the world of SME, innovation to date has all centred around the mass market, the small S of SME.
“True innovation in banking has bypassed those larger, more established businesses, particularly those with more complex needs, who simply look difficult to serve when the majority of innovation centres around online or app-based, mass-market models.
“These larger businesses need bespoke — so that is where we are innovating.
“We’re targeting the difficult bit of SME, the bit that doesn’t easily fit into algorithms and industrial processes and focusing on delivering genuine, impactful innovation into that segment.
“To date, the big banks and early-stage challengers have had it all their own way in this space … that has to change.”
Amir Nooriala, chief strategy officer at OakNorth, said that it was innovating through partnering with non-lending fintechs.
The bank has teamed up with financial app Moneybox and Monzo to help people to save and invest.
The partnerships together have helped OakNorth reach around 2.7 million customers.
“These types of fintechs don’t offer savings as a source of funding for lending, so their users miss out on earning interest on their cash balances,” said Amir.
Amir explained that, as it was a fully regulated bank offering FSCS protection for depositors, it tended to be particularly appealing to higher-earning demographics who have tens of thousands of pounds to deposit.
It also means it can bring its savings platform to a wider demographic and enable younger savers, who may not have as much to save, to still make more from their money.
“We are in conversations with several other fintechs about partnering, so [we] expect to announce more in the coming months — watch this space.”
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
Unity Trust Bank opens new Manchester office after 47% lending growth
Unity Trust Bank has opened a second commercial office as part of its expansion plans...
Tide to launch first premium account
Tide has announced that it will launch its first premium account to all its members by the end of 2019...
Shawbrook launches portal to ‘dramatically’ reduce BTL product switch times
Shawbrook Bank has launched a new online system that aims to reduce the time taken for BTL customers to product switch...
Santander to stop writing new asset finance business by end of 2019
Santander has announced that it will stop writing any new asset finance business by the end of the year...
Shawbrook adds new relationship director to business finance division
Shawbrook Bank’s business finance division has named John Hunter (pictured above) as its new relationship director for its South East regional team...
National Australia Bank updates cloud strategy with Google Cloud addition
National Australia Bank (NAB) has added Google Cloud to its cloud technology strategy...
PMS Mortgage Club and Sesame Network appoint Reliance Bank to lender panels
PMS Mortgage Club and Sesame Network have added Reliance Bank’s range of mortgage products to their respective lender panels...
FCA aims to improve awareness of no-deal Brexit impact on businesses
The FCA has stepped up its efforts to ensure firms are aware of what they need to do to prepare in the event of a no-deal Brexit...
Alba selects Temenos as core banking platform
Temenos has been selected as the core banking platform for Alba...
An interview with Peter Izard: 'I would like to see the wider banking industry become even more transparent'
In an interview with Specialist Banking, Peter Izard, business development manager at Investec (pictured above), talks about training staff, incorporating tech and changing trends in private banking...
Paragon names new managing director of mortgages
Paragon Bank has announced that it will appoint Richard Rowntree (pictured above) as its new managing director of mortgages, subject to regulatory approval...