LFP107 – Integrating Physical & Digital & Changing High Street Banking – Paul Riseborough CCO Metro Bank

Metro Bank are well known for being the first new UK high street bank in some time but that fails to uncover how radically different there concept is.

In this episode Chief Commercial Officer Paul Riseborough joins us to describe how different they are and how the integration of physical and digital can lead to a better outcome for customers.

Not only that but their apparently contrarian strategy of opening new branches whilst the main players are in a race to close as many as possible.

Topics discussed on the show include: 

  • Paul’s work as a trustee for the Making The Leap charity helping kids improve social mobility
  • his recent appointment as a fellow at the Aspen Insititute and how that connects Finance to Social Purpose
  • what the Aspen Institute is
  • Metro Bank was set up to be part of the high street it was trying to server
  • Paul’s career from aspirations to be a tennis pro to where he is today
  • Metro has 56 “stores” (not branches) open 7 days a week a “service and convenience” ethos
  • 1.5 million customers of all types inc business as well as now being an active lender
  • stable bank only leverage 7-8x and don’t access wholesale markets for funding
  • not trying to push product but to serve the customer
  • each branch manager needs to understand their local community – a rare thing in the modern world
  • the average Big High Street bank has thousands of branches; retrenching from an oldskool approach to banking and from too many branches after mergers etc; some banks have branches within as close as 0.6 miles to the next one
  • Metro are aiming for tops 200-250 stores for the whole of the UK, with large hub stores they can cover most of the UK with a reasonable radius to your nearest
  • as they are ~”always open” their productivity is 2, 3, 4x as good as the old high street banks
  • communities losing their last bank in town has real social consequences – eg lending falls markedly in that area (even though in principle it can be done online)
  • the benefits of real life support when virtual support is a pain
  • the main purpose of a branch these days is not transactions but to have face to face conversations – “rethinking what a branch is for”
  • “accountability and trust” – “most people like to solve an issue face to face”
  • what happens when AppBank X has a problem and stops working – where do you physically go and complain?
  • “we can create a really interesting experience by blending physical and digital together”
  • eg come into a branch, open an account, have your cards printed on the spot and get given a merchant services device and be trading that day – that is a different experience!
  • “you can order a new card on your phone, walk round the corner and print it off”
  • cf Amazons new high tech stores, cf Starbucks with ability to order ahead via your phone
  • “Controversial statement – the best thing Monzo could do is open a store!”
  • we had a phase of thinking all tech is phone etc but plenty of real world 21stC tech and improved interaction virtual and physical
  • other sexy ideas of real world physical banking tech
  • stores as community hubs too, events, charities
  • digital isolation, screen addiction
  • Metro’s different banking experience spreads principally by word to word; “we don’t believe in spending millions of pounds on TV Ads”
  • outreach programs into schools
  • “a large number of Fintechs are customers of Metro, we get accounts opened very very quickly.”
  • “don’t believe physical banking is over, it’s here to stay”
  • next store opening on Jul20 in Southampton
  • another ten or so opening this year
  • order of million(s) of pounds a year to have a bank branch
  • “we think of ourselves as a retail business”
  • check out Paul’s book – “Naked Banking – The Truth About Banks And You

And much much more 🙂

Share and enjoy!