Spanish banking group Santander to build digital bank in the UK
Spanish banking group Santander said it is building a standalone digital bank in the UK in a move aimed at boosting its online presence.
This comes amid intense competition in the market with the rise of digital investment advice provided by robo-advisers and fintech platforms such as Monzo and Tandem Money.
The Spanish lender is also said to be bringing its flagship Openbank product to the UK. Openbank is Santander’s fully digital service in Spain. The service amassed more than 1.35m accounts by the end of 2016, according to the Spanish Banking Association.
The standalone digital bank is expected to be built in the next few months and will focus on smaller companies and cater to services beyond traditional lending, such as advice on payrolls and pensions.
A Santander spokesperson said: “As we announced at our group strategy update in October last year, we are working on a project to build an open digital financial services platform for SMEs. We are excited by opportunity to help more SMEs to prosper and we look forward to sharing more about the platform soon.”
City A.M. has learned that Santander will be developing four innovation hubs led by independent CEOs and sponsored by country heads.
The four platforms are: Super Digital – a digital account for the unbanked population in Latin America; Open Bank – a digital challenger bank initially serving the Spanish market acting as a blueprint for a new IT architecture; One Pay FX – a blockchain-based international money transfer service; and an open digital financial services platform for SMEs.
The plans come at a time when smaller banks, including Santander, are vying an £833m fund earmarked by RBS. RBS agreed last year to spend £833m to pay business customers to move to smaller rivals and help fund rival businesses’ objectives to increase competitiveness.