Amir Nooriala, OakNorth’s Chief Strategy Officer, details our current partnerships and the benefits they bring
Since our launch in September 2015, we have proven our ability to innovate in the U.K. savings market, which has been recognized with various savings awards. We now have c.50,000 savings customers who are making the most of their money through the variety of products we offer – fixed term and easy access accounts, notice accounts and a variety of Cash ISAs – and a Feefo score of 4.5 stars.
50,000 customers may not sound like a huge amount but as our average balances are way above average, they are enough to fund our entire allowable loan book. As we offer some of the highest rates in the market, we tend to be particularly appealing to higher-earning demographics who have tens of thousands of pounds to deposit. Therefore, since the start of the year, we’ve been looking at how we can start to bring our award-winning savings platform to a wider demographic and enable younger customers who may not have as much to save to still make more from their money than they otherwise would.
Are first example of this type of partnership this year, launched earlier in the year with Monzo, providing our savings products to their 2m+ customers. Monzo customers have the option to deposit money in a “normal pot” which is good for setting aside smaller amounts of cash and is useful if the customer needs to access the cash instantly, but it doesn’t pay interest. Through this partnership however, Monzo customers gain access to our savings platform, enabling them to choose from a range of saving products to suit their needs and obtain a much higher interest rate than they’d get from a traditional high-street bank. They also get the added benefits of ease, convenience and usability that come with managing their money in one place, not to mention the 24/7 customer service available through Monzo’s app.
Earlier this week, we announced another very exciting new partnership with Moneybox – the financial app that helps people save and invest. The partnership saw Moneybox launch a new Cash Lifetime ISA, powered by us, offering a market-leading interest rate of 1.4% AER variable to their 200,000 customers. This is 0.3% higher than the next best product on the market and because it’s powered by us, customers get the benefit of the FSCS-protection up to £85,000. The product is designed to help customers who are saving for their first home as for many young people, getting on the property ladder continues to feel like a pipe dream. The government’s introduction of the Lifetime ISA in 2017, with its 25% bonus up to £1,000 per year, was a welcome step for millennials but surprisingly few banks have chosen to offer it. We therefore saw this as an exciting opportunity to partner with an award-winning fintech and highlight the importance of financial literacy, whilst streamlining difficult processes and releasing a market-leading interest rate that helps customers save for their first home.
Every week, I personally meet fintechs from across the UK (and now globally), so we’ll definitely be announcing more partnerships in due course. If a fintech has customers (individuals or businesses) who deposit with them but who aren’t currently earning any interest on those deposits, we’d love to speak to them. If they want to give those customers peace of mind that their money will be safe up to £85k, we can help as our banking license means we can offer FSCS protection. If a fintech who has a banking license (such as Monzo) wants to offer a broader range of savings products to their customers in their marketplace, reach out and I’d be delighted to have a conversation.
It was great to get recognition for this approach in business insider last week, who wrote:” The start-up is increasingly becoming the go-to savings partner for UK fintechs…. These partnerships enable OakNorth to bolster its balance sheet for its lending business, at a lower customer acquisition cost.”
For me, the key to a successful partnership is finding other players who are as passionate, fast-moving and customer-centric as we are. This has been central to the success for the Monzo and Moneybox partnerships and will be essential for future partnerships.