2. Monzo

Standing out as a British neobank isn’t exactly easy (there’s a lot of them–a lot), but Monzo is managing admirably. Started out back in 2015, the bank is focusing on slowly, but steadily building out a responsible suite of banking products for its consumers, leveraging mobile and faster payment technologies for some fintech flair.

“We’re still focused on building the best current account, building integrations with other services, other accounts, other products,” Tristan Thomas, head of marketing and community for Monzo, told Bank Innovation. It’s been quite a busy 2017 for Monzo, with the bank gaining full regulatory approval from the United Kingdom for its services.

Monzo’s focus on building “the bank of the future” has garnered it approximately 200,000 customers to date–but what about Monzo’s approach has attracted to those seeking an alternative way to bank?

“The world of mobile technology is making it so people are used to being able to do everything on their phones. Banking is set in the past, so far behind, totally different to the way people live their lives,” Thomas told Bank Innovation. “We’re building all of our core systems from scratch, which gives us a huge amount of flexibility.”

3. Upstart

What’s the future of lending? A bunch of algorithms, continuously analyzed by robos, if you ask Upstart.

This five-year-old online lender utilizes AI and machine learning algorithms to gather consumer data points such as education history, social media information, employment history, or even web behavior (during the loan application), in order to make underwriting decisions. This allows Upstart to identify quality borrowers (especially thin-file millennials) that traditional credit models tend to oversee.

Currently, more than 25% of Upstart’s loans are fully automated, according to CEO Dave Girouard. “We have made this progress in the last four to five months; back in November none of our loans were fully automated,” he told Bank Innovation. The company started out testing fully automated underwriting process on small, low-risk loans, Girouard said. “By the end of the year we expect the majority of our loans to be 100% automated.”

Upstart has originated almost $700 million in loans to date. Back in March, the company raised $32.5 million, bringing its total funding to $85.7 million. Besides its original direct-to-consumer model, the company is now also licensing its technology to other FIs.

“Most fundamentally, we believe that every flavor of lending will be based on machine learning and artificial intelligence in 10 years, and it’s hard to imagine any successful lender of any type without having built or partnered with someone who provides that technology,” Girouard said. “Our view, generally, is that it’s a very large and fractured market, and it’s not reasonable t assume that any participant, be it a bank or a startup, will own the majority of the market. We would like to participate economically, and it can be best achieved by the direct platform, in addition making our technology available to others.”

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