NatWest digital bank goes live

A standalone digital challenger bank created by NatWest is now available, offering an alternative to the emerging challenger banks. Bó, as the app-based bank is known, can be downloaded from the Apple Store and Google Play.

The new bank is built in the cloud completely separate from NatWest’s systems and has its own Faster Payments connection. It is positioned as a rival to challenger banks in that it offers the functionality that makes them popular, including money management tools and spending alerts.

NatWest said Bó was designed to help the “high number” of people who are struggling to manage their money. The bank looked at anonymised data from 2.6 million customers and found that half of them spend everything they earn, and a quarter spend more than they earn.

Mark Bailie, CEO at Bó, said that in the digital age, people need support in managing their money more than ever, and it is all too easy to lose control. “Our data suggests that three-quarters of people in the UK are living financially unsustainable lives,” he said. “We want to help change this.

“Bó will help people build the habits and routines that will allow them manage money better day by day and week after week, so they can fund their lives and lifestyles in a more sustainable way.”

Customers can transfer spending money to Bó to help them manage it, receive instant alerts whenever they use their card so they know what they have spent and where, see all their purchases listed by retailer, and set goals to help them save.

Bailie said the bank will be agile in its technology adoption as a separate entity to NatWest, but will benefit from being part of the traditional operation.

“As we’re part of NatWest, people can rely on Bó to keep their money safe,” he said. “But as a digital bank, built entirely on a separate cloud-based technology, Bó is also able to harness new technology and develop rapidly in line with our customers’ needs and expectations.”

Last year, giving a clue to its target market, Bó took a 25% stake in fintech Loot, which offers a money management tool for young people and students.

This is not the first time the RBS Group has launched a standalone challenge. In the small and medium-sized enterprise (SME) lending space, it created Esme Loans, which uses the latest technologies to differentiate itself from traditional lenders.

For example, it has cut the time it takes SMEs to apply for a loan to 10 minutes, offering them loans of up to £150,000. Application is expedited by using the latest technology, including artificial intelligence and application programming interfaces, so it can connect with external data.

Reports last year suggested that the bank, part of the RBS Group, will migrate about a million customers from its NatWest arm to Bó. If these reports prove correct, all eyes will be on the bank in the light of the carnage experienced at TSB when it moved customers to a new platform.