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Older banks face being 'swept away' by technology

By Ben Woods

The boss of challenger bank Monzo has warned that major British banks face ruin as they are swept away by new technology.

Tom Blomfield, Britain's youngest bank chief executive at 31, believes the British banking system is broken, warning that customers will also lose out as the Brexit vote forces major lenders to scale back their innovation investment and focus on staying afloat.

Mr Blomfield said: "I think many of the big incumbents right now will die. They have not kept up to date and they are technologically bankrupt. That will catch up.

"With Brexit and the spectre of negative interest rates they [the banks] have retrenched," he added.

"I have heard that many of these digitisation projects have been cut. It's just back to being inward looking and focusing on staying solvent.

"Each of the banks has an innovation team or a digital lab, but they are kind of for show. When things get a bit rocky or serious, they get their funding cut and they go back to getting the basics right."

Mr Blomfield is hoping Monzo will help shake up the industry when it launches in six months.

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