Oxbury Bank, (bucolic name isn’t it?) will shortly be opening its doors for business after a £ 15 million injection from Wheatsheaf Group, part of the Duke of Westminster’s not inconsiderable portfolio. The outfit has been formed by CEO James Farrar who amongst other things co founded tech start up Clearbank which offered Banking as a Service around a collection of clearing and payment services. It is unclear how successful that operation currently is but it has obtained a banking licence so it must be doing something right. Oxbury Bank has a collection of Bankers and Farmers among its executive base. Post Brexit the agricultural community is living in interesting times as the Chinese might say so the time is ripe for innovation. Seventy per cent of agricultural lending is with the big four UK players and Oxbury is planning to seize an ambitious 8% market share over the next five years. Obviously there is sectoral risk here but we all have to eat don’t we? A punt maybe but an interesting one. We’ll see how it goes.
Apparently Revolut the digital banking app is winning the race against its two biggest rivals Monzo and Starling Bank at least on one measure. This is based on the number of application downloads. Revolut was downloaded 5.8million times in 2020 eclipsing both Monzo (2.4miilion) and Starling (1.3 million). The data also shows that as the pandemic took hold the number of downloads declined sharply. Nevertheless the growth rate is impressive when compared against its peers. A lot of the growth has taken place outside of the Uk with Revolut being available in some 36 countries. Revolut revealed last year that despite revenues tripling so did losses. Fintech start ups are used to this and prima facie it doesn’t look bad at all. Strategically however operating across 36 countries and regulatory authorites carries some risk with it. Two thirds of Revolut’s revenues come from prepaid credit cards very popular with international travellers thanks to very competitive FX rates. We all know the impact international travel is experiencing. However client acquisition is absolutely essential to whatever business you are in so Revolut is leading the pack so it seems.
Rishi Sunak Britains Chancellor of the Exchequer’s Stamp Duty holiday which expires on March 31st this year has turbo charged the UK housing market pushing prices up over 7 per cent in just one year. In overall lending terms however the early months of the pandemic produced even greater reductions. Most experts are predicting a fall in prices after the end of the first quarter pointing to a mass movement from the capital to the leafy suburbs and countryside in anticipation of a permanent shift to home working. However the underlying dynamics are still opaque and anything can happen. Nevertheless it does show that even in a market where the fundamentals are awful taking a tax of something still stimulates massively. Rishi’s Eat out to Help out showed this in spades. This ought to be a lesson well learned.
Howard Tolman is a well-known banker, technologist and entrepreneur in London,
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