Metro, Starling and ClearBank share £280m of RBS funding


(Dan Mullen) #1

Great news for business customers.


#2

I think Metro will gain the most from it, opening new branches is it’s key to success for them, and for business, a branch with longer hours is appealing.


(James Cocker) #3

Is this the pot of money that Monzo was hoping to use for its business accounts? Or is that a different RBS one?


(Dan Mullen) #4

I believe so, although this is just the first batch of grants. More to be awarded later this year.


(Dan Mullen) #5

Official announcement from Starling. Online banking to launch for business customers later this year!


(Tom) #6

Just saw this! Think this is an excellent move, and will probably remove one of the main barriers that was stopping businesses from switching.


#7

Hopefully it’ll make its way to personal accounts too before too long.

Depends on the type of business. For a retail business that deals a lot in cash, branches are important, and Metro will do well. For a services business though (eg a web design agency), branches are not important, so Starling would be a good choice. They serve different customer segments, so great to see them both in there


(sam) #8

Personally I’m glad never to need to visit a branch again. It was always an ordeal. Parking in town, queuing up, just to pay down cash in. It’s taking me about 1 minute on average at the post office.
Hopefully starling can sort cheque imaging out asap.


(Marcel Ruhf) #9

If I remember correctly they specifically applied for the next tranche since they decided to apply quite late (at which point the deadline for the first tranche had already passed).

Overall very good news, um looking forward to what Starling can produce with the funding and what if means for the full offering, personal accounts included


#10

Why is RBS giving grants? Surely its in their interests to loan this money to companies, not give it away


#11

The key bit being…

The government and the European Commission ordered RBS to provide the money, comprised of two separate funds respectively intended to help smaller rivals build their offerings and encourage customers to switch providers.

It is meant to compensate for the taxpayer-owned bank’s 45.5 billion pound bailout during the financial crisis, seen as an unfair boost to already one of the biggest banks.


#12

Wasn’t that bailout to stop them from going bankrupt? As in “they may be one of the biggest banks, but they were literally on deaths door and that was to just save their balance sheet”


#13

Yes I believe so.

But you don’t just get a free handout and carry on your merry way.

This is the consequence.


#14

They had to either agree a way to stop the monopoly they hold or face regulation. So they agreed with the UK government and the EU to help other banks gain some of its customers, it agreed to do this by awarding grants to banks that meet specific guidelines that was agreed by all the bodies concerned.

Regulation would see RBS lose, this way, yes they are giving out a lot of money, but if the banks they give it to, don’t gain many customers from RBS, it won’t be something RBS can be regulated over. It’s actually a winning scenario for RBS. Yes a bit of money they have to give out, but they can look at ways to gain new customers while ‘competing’ in an open market.


(Liam) #15

RBS was required to spin-off a ‘challenger bank’ in the same way that Lloyds were forced to curl out TSB.

RBS was intending to launch its challenger bank using the old Williams and Glyn name it gobbled up years ago.

I think this fund was set up to avoid them having to do so!


#16

Yes, but not really, RBS spent something like 800 million then decided that Williams and Glyn wouldn’t work, I have a feeling they expected the government not to make them still do something after spending so much, it back fired on them, so the fund was launched.


(Don't Bullshirt Me, I know what the Fork is going on here!) #17

Except they couldn’t get anyone to buy Williams & Glynn (the spin off) so they reached an agreement to give away a buttload of money instead


(Liam) split this topic #18

A post was merged into an existing topic: Starling Web Portal Confirmed


(Liam) #19

Though perhaps you launch it first and then try to sell it.

It never got launched.

They could always have floated it if there were no takeover offers.


(l8n.me) #20

This was exactly what I thought. Look at TSB. No, really, and don’t snigger. It lasted a year out of Lloyd’s before it was snapped up, so I can’t see that the situation with W&G needed to be different. Plus I seem to recall RBS had to put a decent chunk of cash into W&G too to keep it going, so it wouldn’t be like taking on a failing bank. Offer something customers want and I can’t see it would be a disaster. To me it was likely more that what they were offering wasn’t appealing enough. The trouble with RBS all along is that to this day they still feel like they have an air of arrogance about them, installed from the Goodwin days of building an empire. The W&G thing feels to me like someone saying in court “fine, I’ll pay all the fines you want but I’ll never apologise or make amends”, they’d rather just cough up some cash than have the lasting reminder of W&G taking their customers, filling what were their branches, having to keep putting money into someone else’s business. Classic ‘cut off your nose to spite your face’ stuff.