UK: New challenger bank to launch in UK

Despite a recent increase in the number of new challenger banks entering the UK, yet another challenger is preparing to launch. The new challenger intends to offer both online and a branch network. Headquartered in Chicago, Iam Bank will be joining the increasing number of UK challenger banks, having already launched its website with a digital learning offering.

Dubbing itself the “Apple Store” of banking, Iam Bank targets Millennials with low-cost savings, pensions and investment products to encourage good saving habits amongst young people. Specifically, the bank plans to be the first of its kind to roll out free learning and therapy-based financial workshops across the UK from September this year.

Despite currently offering several online banking services, Chief Executive Officer, Lee Travers, has revealed that Iam Bank is now looking to acquire a small UK bank or building society to enable it to launch a network of branches across the UK, believing that consumers, “still prefer the safety and security of traditional banking.”

According to RFi Group’s H1 2016 UK Priority and Retail banking data, the decision of Iam Bank to not provide a digital only offer may well be a smart move. Currently only 30% of banked Millennials in the UK (ages 18-35) state they would be comfortable having a digital only bank as their main financial institution.

According to RFi Group’s H1 2016 UK Priority and Retail banking data, the decision of Iam Bank to not provide a digital only offer may well be a smart move. Currently only 30% of banked Millennials in the UK (ages 18-35) state they would be comfortable having a digital only bank as their main financial institution (MFI) while another 32% would be comfortable to hold a financial product with such an institution, but not as their MFI. However, almost 2 in 5 of all Millennials don’t feel comfortable to have any products with a digital only bank. Hence, Iam Bank is certainly increasing its opportunity in this market by looking to establish a branch network.

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