Business banking news review: week ending 23 OCt 2014
Here’s a riddle for you: why stick with a High Street bank that’s not meeting your needs whilst upstart banking providers are running circles around them?
It’s an age-old quandary that few people seem to be able to answer. Older, more established banks are reticent to take even the safest of risks on offering personal or business bank account services like mortgages and business loans, yet newer banks trying to establish themselves are ready and waiting to offer everything they can to new customers. If this goes on much longer, there’s likely to be an exodus to newer British institutions like Metro Bank while High Street branches empty.
One of the worst markets in the UK where High Street lenders are under-serving prospective customers is in the financial technology sector. Fintech industry representatives say that British banks are being stingy when it comes to providing basic services like loans or even savings accounts, and much of the problem relies around High Street being reticent to provide support for digital currencies like Bitcoin.
Now I’m not going to even pretend to understand cryptocurrencies like Bitcoin, but I do know that they’re probably about as volatile as any other investment like stocks and shares. Conversion rates go up, they go down, and it’s just like any other currency. Sure there’s no sovereign nation behind it, and I suppose that scares the trousers off banks, but it’s the 21st century; if you ask me it’s time for banks to get with the times.
Meanwhile a bank that’s definitely getting with the times is Metro Bank, as it’s been making serious gains lately. The bank says that last quarter saw a total of £1.39 billion in loans – up significantly from the £1.16 billion figure that stood at the start of the quarter. Not only that but this new figure is double last year’s amount – and deposits went up by £350 million in the last quarter as well to £2.34 billion.
I don’t know if Metro is any more accepting of digital currencies like Bitcoin than its larger, more staid and moribund High Street counterparts, but I can tell you one thing: it’s much more likely that this financial service provider will add support for the cryptocurrency than a stuffy old High Street bank will.