JPMorgan Chase plans to launch a digital bank in the U.K. in the first quarter 2021, according to Sky News report. The launch would put the bank in a position to capitalize on the growth of digital services amid the Covid-19 pandemic.
August 26, 2020 | AtoZ Markets – JPMorgan Chase is set to launch its UK digital challenger which includes a range of savings and loan products under its Chase brand in the UK in the first quarter of 2021, Sky News reports.
The Wall Street stalwart has reportedly named Clive Adamson, who is the former head of supervision at the City watchdog and a non-executive director at JPMorgan Securities, to lead the new business.
JPMorgan in talks with the FCA to launch UK digital bank
Earlier this year, the world’s largest lender by market cap was reportedly on the verge of closing on to make an entry in UK’s retail banking sector. Since February, JPMorgan has been in discussion with the FCA and other regulators to get the necessary go aheads and approvals to launch a digital bank.
Sources familiar with the matter said the bank will be likely signing up Amazon Web Services. It will also sign up with 10x Future Technologies to provide it with cloud and digital banking infrastructure.
The launch could spur a shake up in competition and prices among incumbent lenders. This includes its rival Goldman Sachs which launched its retail consumer bank Marcus in the UK in 2018. Marcus had attracted nearly 500,000 British customers and more than $20 billion in UK deposits, but the current offering is smaller than what JP Morgan intends to launch. The new venture likely to target a broader audience. However, it is not clear whether it will also tap the UK mortgage market.
Marcus, however, was slowing growth of its UK online-only bank. This was after deposits surged near to regulatory limits which would require stricter regulations.
What will JPMorgan’s UK arm offer?
JPMorgan claims consumers can open an account online under 5 minutes and has over more than 50 million users. However, its consumer banking business has mainly operated in the US so far. JP Morgan’s UK arm is likely to offer savings and current accounts. Nevertheless, its open banking services and loan products will be entering into a tough market for challengers in the UK.
JPMorgan’s U.K. plans wouldn’t be the company’s first attempt to launch a digital-only bank. The New York-based bank launched Finn in 2018 before shuttering the app a year later, following disappointing user numbers.
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