Here's What JPMorgan's New UK Digital Challenger Is Going to Look Like -Financial News
September 17 2021 - 4:12AM
Dow Jones News
By Emily Nicolle
Of Financial News
JPMorgan Chase & Co. is to launch its digital banking
challenger brand Chase in the U.K. on Sept. 21, after years of
secretive development.
It will initially offer current accounts alongside a rewards
programme for customers, before expanding into other products over
time such as savings, digital investing, loans and mortgages.
The Wall Street lender has invested significantly into building
Chase's operations, with 600 in the U.K. and a further 250 overseas
in customer centres. In the U.K. about 500 of those staff were new
hires from fintech firms, banks and other sectors, a person
familiar with the matter told Financial News, while 100 workers
were transferred internally within JPMorgan.
Chase will operate via JPMorgan's U.K.-based subsidiary, with
activities regulated by the Prudential Regulation Authority and the
Financial Conduct Authority.
Sanoke Viswanathan has been appointed CEO of the digital bank,
having previously been chief administrative officer and head of
strategy at JP Morgan's corporate and investment bank.
JPMorgan is entering one of London's most hotly contested
markets. Digital challengers Monzo, Revolut and Starling Bank are
already jostling for primacy across millions of customers, though
they have at times struggled to stay abreast of regulators and
maintain fast-paced growth.
"This is a very big strategic commitment from the firm's
standpoint," Viswanathan said in a Sept. 17 interview with the
Financial Times. "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."
The move comes after several acquisitions by JPMorgan to beef up
its digital and payment capabilities in the U.K. and Europe, buying
three-quarters of Volkswagen's payments business and agreeing to
acquire digital wealth manager Nutmeg this summer.
The bank also signed a 500 million-pound ($689.50 million)
funding deal with fintech firm LendInvest in January to fund future
mortgage originations, having already bought a GBP125 million
mortgage portfolio from the startup in September last year.
The digital brands of traditional banks have had a mixed
experience. Goldman Sachs' savings bank Marcus landed in the U.K.
in 2018 with market-beating interest rates but was forced to reduce
rates and temporarily suspend new accounts last summer due to
heightened demand. NatWest's digital banking firm Bo closed after
less than six months last year, despite a broad campaign to
advertise the brand using celebrity influencers on Instagram.
JPMorgan's first attempt at a digital brand offshoot in the
U.S., known as Finn, was also cancelled after a year in 2018 after
struggling to differentiate the business from the main bank.
Website: www.fnlondon.com
(END) Dow Jones Newswires
September 17, 2021 03:57 ET (07:57 GMT)
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