Metro Bank opened the doors to its first branch in the UK today. The Holborn branch, or store as Metro calls it, promises to be the first of many with plans for 10 more in the next 2 years and ultimately in excess of 200 stores.
Promising a revolution in banking, Metro has focused on its intention to provide a great service and one not currently offered by many high street banks. The stores will be open for longer hours (8a.m-8p.m.) during the week and also at weekends.
Current accounts can be opened in 15 minutes and debit cards and cheque books will be printed instore so, assuming you are accepted, you can walk away with fully functioning cards and account. And don’t forget that free dog biscuits will be available for their customers’ canine friends.
Sounds good but it’s not long into any conversation about a financial product before the word ‘rate’ comes up. It would have been a surprise to see barnstorming mortgage rates at launch and the small range of mortgage products doesn’t produce any surprises.
The rates are, roughly speaking, about 1% off the pace of the better products in the market. From the limited information available it doesn’t look like they are particularly racy in their design, with a maximum LTV of 80% and the better rates for those with 40% to put down.
Rate certainly isn’t everything in a mortgage product but there will need to be a narrower margin between these deals and the rest of the high street for the promise of a good service to overcome price concerns.
It would have been a mistake to try and storm the market without having bedded in their first store and the new systems and processes. However the launch of a new UK Bank in these straightened times is significant and is a proposition to be watched with interest.
The question will be whether a retailer approach to banking hits the right note with customers. How will they value long opening hours and face to face contact in a world where telephone and web access is becoming the norm and what will they be prepared to pay for that?