FinTech: JPMorgan Chase To Unveil UK Digital Bank Next Week
JPMorgan Chase is launching a fully digital lender bank in the UK next week, the first overseas retail bank in its history of 222 years.
JPMorgan Chase (NYSE: JPM), the largest bank in the US, may disrupt the UK banking market with its launch next week of a digital lender retail arm offering, in the first instance, current accounts with a reward program. (FT)
A new UK bank with (very) deep pockets
JPMorgan Chase is calling the UK operation Chase (it was dubbed Project Dynamo while being developed secretly). It will invest heavily into making Chase a meaningful force in UK banking, according to Sanoke Viswanathan, head of JPMorgan’s newly formed “international consumer” division.
Speaking to the FT at Chase’s Canary Wharf HQ, Viswanathan said: “This is a very big strategic commitment from the firm’s standpoint. We will spend hundreds of millions before we get to break even and get to a place where this is a sustainable business, and we’re not in a rush.”
With launch restricted to current accounts, Viswanathan said regarding mortgages: “In the current conditions there is a massive oversupply of mortgages and lots of providers . . . but to be a full-service bank and have consumer trust over the long term it is an important product line.”
JPMorgan envisions that within three to four years UK customers would conduct all their banking with Chase, and “not have to bank with other people.”
Chase is looking to beat legacy banks in the UK with its branchless operating model and huge tech resources. It will get an advantage over other digital challenger banks through its regulatory strength and massive balance sheet.
Viswanathan also said the new Chase was not fixated on achieving a customers’ number count or on becoming profitable by a certain date.
“We’re committed to this country for the long term,” he told FT. “We didn’t take this decision on a whim.”
Image of Jamie Dimon, CEO of JPMorgan Chase: Wikimedia
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