Masthaven joins a crowding UK banking market
Another challenger bank has arrived on the UK market. Launched last week, Masthaven wants to move away from a ‘one-size fits all’ model, to offer a digital banking proposition with a human touch.
The banking provider received a retail banking licence in April this year; however, it has been offering bridging loans and secured lending since 2004 under the name Masthaven Finance.
Ownership of the bank has been divided between the founder, Andrew Bloom, who has a majority of shares, and the billionaire Pears family and Masthaven’s employees.
Part of the decision to move away from ‘one-size fits all’ banking has to do with tailoring offers to individuals.
For example, customers can set their own savings terms and decide if they want interest to be paid monthly or annually.
Masthaven points out that they only use digital automation to handle admin, not for decision-making. Therefore, all personalised offers are created by people, not computers.
Our senior analyst, Ross Gallagher, comments: ‘As the presence of retail banks on our high streets continues to decline, and more of us are turning to digital channels to perform our day-to-day transactions, we are very much in danger of losing the personal approach that has defined retail banking for so long. While granting customers the control and flexibility to self-serve with regards to everyday banking transactions is undoubtedly a step in the right direction – at least as long as these processes are designed to be user-friendly and accessible – personalised support should be available to customers requiring more complex financial products and services.’
For many other challenger banks on the market, this human selling point might be overshadowed by the digital aspect – some might not offer any human interaction apart from over web-based chat. However, it certainly exists in incumbent banks, although it’s not promoted to customers in the same way.
‘Masthaven’s offering is different to that of other digital-only challengers that have launched in the UK recently, in that the provider is committed to delivering what it has termed “human digital banking”, whereby lending decisions will be made by real people based on an individual’s circumstances, rather than relying on automated digital processes,’ says Gallagher.
In their Customer Charter they make several promises relating to their people and customer service, such as access to respectful bank representatives, who aim to solve all queries the first time customers make contact – if possible.
The Customer Charter also goes on to make promises to tell customers ‘what happens next and by when’ and to keep customers informed of progress. Interestingly, Mapa recently conducted research on application and early customer onboarding processes in the UK, showing that there are improvements to be made in terms of communications and progress updates.
‘Back-end processes often fall down and customer expectations are generally very poorly managed throughout, something which can significantly affect the likelihood of converting applicants into active customers. A more personal approach should result in an enhanced customer onboarding experience, and ultimately drive overall customer engagement,’ says Gallagher.
What is particularly interesting is that Masthaven will also offer specialist mortgages, designed to meet the needs of borrowers who might fall outside of the parameters of the established banks. Gallagher concludes, ‘There is no doubt that this human, customer-focused approach will appeal to customers frustrated by the lack of personalised support from existing providers, as well as those consumers who have been turned away by the traditional lenders when exploring borrowing options.’