The Fintech Times – by Gina Clarke
After the financial crash in 2008 UK financial regulators encouraged more competition into the UK banking sector. The aim was to reduce the hold the biggest UK banks had on the market, estimated to be as high as 87% of all current accounts in 2017.
Metro Bank was one of the first challenger banks and had its banking license approved in 2010. Since then, numerous other new banks have been awarded licenses including Aldermore, Virgin Money and Zenith Bank.
In the UK especially, the introduction of instant payments and access to the faster payments system was a real catalyst for the challenger bank creation believes Alistair Brown, Head of Global Payments, EPAM Systems, Inc.
He said, “The rise in instant payments and the appearance of the challenger banks are parallel threads in the same pan-European story, both developed to encourage increased competition in European financial services.”