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Innovative banking model for improved financial and economic inclusion of population groups that find it difficult to open a traditional bank account

Periodic Reporting for period 2 - MONESE (Innovative banking model for improved financial and economic inclusion of population groups that find it difficult to open a traditional bank account)

Reporting period: 2017-02-01 to 2018-01-31

MONESE project aimed to scale up the technical capability of the banking service, develop new features for expanding into wider European area and increase the level of customer onboarding automation. Combining these developments with our business model innovation (fixed-fee pricing, streamlined value proposition, value chain deconstruction, focus on underserved people) enables us to achieve EU-wide scale coverage in a profitable manner. Monese banking account service becomes available to a large group of mobile, underserved and unbanked consumers (>56 million in EU), significantly increasing the economic and financial inclusion of these people.

In order to achieve the main objective, several specific sub-objectives have been defined. By the end of the project we have achieved the following results:
1. To scale up system architecture in order to be able to serve at least 20,000 simultaneous users.
We have successfully tested ability to serve 10 000 users in a live environment and are confident our own technology is able to serve over 20,000 users in an offline mode.

2. To finalize new features in order to be able to reach wider markets.
Monese now enbales customers to easily sign up for a GBP or EUR account in minutes from a smartphone. Once the first account is opened (after the initial on-boarding) in either GBP or Euros the customer can add a second account in the other currency at the tap of a button. This allows our customers to have multiple accounts across Europe, keep all their funds in one single place and significantly reduce any currency conversion charges.

3. To decrease the average time spent on user identification, allowing streamlined user experience and customer acquisition.
By introducing a new ID document verification flow to our KYC processes, as outlined in WP3.3 we were able to increase the percent of our automatically onboarded customers more than 5 times.

4. To test and assure the functionality of the improved service and validate the improved efficiency of the processes on 5 000 users.
Monese Euro account and card product was successfully tested on tens of thousands of users. Our system load handling capabilities has been tested on 10,000 users.

5. To implement business model innovation for wide-scale market introduction – validate a fixed-fee pricing model EU-wide and build a network of at least 20 stakeholders for commercialization.
By the end of the project we had validated the fixed-fee pricing model on EU-wide market, built up a strong stakeholder network for commercialization, and performed comprehensive dissemination and explotation activities.
By the end of the project the main achievements of the WPs are:

WP1 – Scale-up of system architecture required for serving the growing user base
From observing our database usage and knowing our database queries load capacity our infrastructure would be able to handle more than 20,000 simultaneous users

WP2 – Finalization of new features required for wider market reach
We have implemented the support for Euro denominated IBAN accounts and launched the multicurrency support (Euro account and card) in late September 2017.

WP3 – Automation of user identification required for streamlined user experience and customer acquisition
We implemented new id verification solution and enhanced video call functionality. The specific objective was to reduce the number of accounts automatically created without any assistance from Monese support team by 50%. The objective was successfully achieved.

WP4 - Testing and validation
By the end of the project we have performed in-house tests for the developments and validated the improvements of the new architecture and its components on test groups.

WP5 Commercialization and communication
We finalised the business innovation plan incorporating a detailed commercialisation action plan, built up a strong partner network for commercialization, held many successful promotion campaigns, were present at social media, and participated at the main events.
We also validated a fixed-fee based pricing model on EU-wide market. Based on the customer interviews performed Monese introduced at the end of January an additional fee package which has no monthly fee but higher transaction based fees and lowered the monthly fixed fee. We believe giving both options to the customer – all-inclusive monthly fee package and no monthly fee package with higher transactional fees – will serve the different customer needs better and increase share of active customers on the Euro account product.
At the beginning of the project Monese was the only fully-featured banking service that operated across Europe, whilst onboarding non-residents and those who would otherwise be excluded from mainstream financial services. Today, in addition to all that, Monese product is available in 7 more languages, allow people to have both a UK and a European bank account and made our onboarding process quicker and easier than ever before. The impact is clear - with increased availability, and greater automation, we’re able to offer our services to more people, providing them with bank accounts that have proven to be an essential part of everyday life. In addition, majority of all incoming funds to Monese are salary (or equivalent) payments, showing that people use Monese as a primary account.