Here's proof – if you needed it – that the rise of challenger banks continues.
The government has granted its first retail banking licence of the year to Masthaven Bank – and the group is promising to "disrupt the market" with its approach to savings, mortgages and staff.
Masthaven Bank received the thumbs up from the Prudential Regulation Authority and the FCA, enabling the lender to expand beyond its existing remit of offering bridging loans and short-term finance.
Economic secretary to the Treasury, Harriett Baldwin said “Incentivising new banks to come to market is a key part of the government’s drive to increase competition in banking… It is great to see Masthaven successfully taking the leap from specialist mortgage lender to a new retail bank focused on digital services."
The bank said it aimed to "put people in control of their own financial goals", by allowing customers to build their own products from launch.
Savings and mortgage customers will be able to determine maturity dates and interest rates, through an online fixed-interest savings range. Employees will be given share options in the bank, which will be majority owned by founder Andrew Bloom. The billionaire Pears family will also hold a stake.
Managing director Jon Hall said: “In a world of ever increasing personalisation, many people want to take more control of their money and make it work harder for them. We’re determined to buck the ‘one size fits all’ approach to banking by helping retail customers play a bigger role in tailoring products to best suit their needs.”
Bloom added: “We want our employees to hold a stake in the business that we will be building together, because as a bank we’re only as good as the people we employ. Our new team combines great talent and experiences with a shared vision to change banking for the better, working with our customers to help give them greater control of their finances.”
Masthaven Finance started lending in 2003 and has specialised in first and second charge residential and BTL mortgages and short term loans.