DIY online banking with the Mondo API
The next generation of banks will be those providing 'smart' services that use technology to anticipate and adapt to customer needs.
A queue of challengers including Atom, Starling and Tandem plan to disrupt the retail banking sector with a more agile, innovative application of digital than the lumbering incumbents could hope to muster.
Here’s my experience of sampling Mondo's initial take on that disruption – a Beta digital-only banking service.
Naturally, convenience is part of the proposition – it’s for people who want to achieve things in a click rather than a trip to the bank. But a nicely designed mobile app to easily check your balance – while no small achievement for an old bank – wouldn’t be quite smart enough to stand out from the new crowd.
First, the hype machine
The invitation policy for Mondo’s public Beta cleverly stokes demand: referring a friend moves you 4000 places forward in the sign-up queue, sending others backwards. So months of leapfrogging passed between signing up and my bright pink debit card arriving, allowing me to activate the app.
Was the anticipation worthwhile?
First impressions suggested yes. The card’s packaging reassured me I’d get "a more engaging banking experience" (as I am sure Mondo’s customer experience team intended me to).
However, once I’d added the first hundred pounds to the account, and made a purchase which unlocked the smartphone app — I felt, well, a little underwhelmed.
Maybe due to the hype around Mondo (and Fintech companies in general), expectations were always going to be higher than what could be delivered. At the time of writing, you’re limited to viewing (albeit in real-time) transactional information and transferring money between Mondo accounts. While the features listed in their roadmap look like they are worth waiting for, at the moment there’s no way to manage direct debits, set-up standing orders etc. This limits my day-to-day usage of the account.
Work in progress
But stepping back, the obvious “BETA” label on the card and their public roadmap (which lets us vote on candidate features) are more than just declarations of work in progress – the whole endeavour feels more like a web startup than a challenger bank.
This feels like a good thing. And like many internet startups Mondo have provided an API (Application Program Interface) which allows customers to securely access their data using other web services.
API-first is the right strategy
Traditionally you could only access your banking data by manually downloading MIDATA formatted files, or using third party services that “scrape” the data from your account after you grant them access.
While data scraping is popular with personal finance management services and aggregators like PocketSmith and OnTrees the issue with this approach is trust. You need to trust a third party with your banking login details – the technology isn’t sophisticated enough to limit them to specific products, accounts or grant read-only privileges. Your bank probably won’t like this and you will most likely forfeit any kind of protection if your account is accessed by anyone with malicious intent.
APIs provide better controls. The inclusion of an API early in Mondo’s lifecycle is the right strategy – and demonstrates their commitment to support third party apps and services.
So while I found the actual experience of using the embryonic Mondo Beta app a little underwhelming, I’m encouraged by the way they’ve laid technical foundations that should empower users. Anyone who knows how to work with APIs can build their own apps – to create the kind of service features we want to see, rather than what banks decide to give us.
Crowd-sourced product roadmap
Independent developers have already created Mondo account dashboards, spending graphs and even a demo that creates music from your transactions. (Here’s a list.) Hopefully soon we’ll start seeing smarter services that provide us with analysis of, and insights into our spending habits, showing us ways to save and lots of other things we haven’t imagined yet. Someone here has hooked it up to a plywood pig, but that’s a whole other blog post.
The evolution of banking
This feels like an exciting time and the potential for innovation is great, especially given that PSD2 is around the corner. While our place in the EU is now in doubt, and therefore it is uncertain whether we need to comply with PSD2, HM Treasury has seen the opportunity of granting greater access to banking information, and are keen on getting things moving quicker than the PSD2 deadline of 2018.
They’re promoting the Open Banking Standard, so that – just as Mondo has – other UK firms will have first mover advantage. But traditional banks will have a lot of catching up to do, especially considering many will be sitting on legacy IT systems which will only inhibit their ability to meet this standard. Mondo already has a head start and creatively minded account holders can start using it to build the kind of online banking services they want right now.