Is Metro Bank the beginning of a new banking era?
There’s a new kid on the banking block trying to wow us with shiny service. Metro opens its first branch today and we’ve scratched beneath the surface to see if it lives up to its claims.
If you’ve passed through Holborn in London recently, you’ll have seen banners publicising Britain’s first new high-street bank in over a century – Metro Bank.
Today’s opening day, but I went behind the scenes earlier this week, and I have to say I’m impressed by the setting.
Farewell to stuffy bank ‘branches’
High ceilings, a bright and airy branch (or ‘store’, as Metro prefers to call it), no security screens, fun coin-counting machines for the kids, lollies, toilets. There are even biscuits for your dog.
It’s all a very long way from the stuffy, traditional bank branch. Still, the concept behind the bank owes more to traditional banking than you might think. It’s refreshing to see that they’ll take in savers’ money and lend it to customers taking out the bank’s mortgages, loans and credit cards.
No structured products, no payment protection insurance, no investment products. And it’s open 7 days a week. Great.
Is it time to switch banks?
But is all this enough to make you switch from your current bank? Metro Bank’s products appear (on first look) to be straightforward, but the rates on offer aren’t earth-shattering.
The main current account doesn’t pay credit interest and charges a market-average 15% overdraft rate. If you go overdrawn without prior permission, you’ll have to pay a £10 fee for each paid item and £5 for each bounced one, up to a maximum of six times a month. While not the best, it’s far from being the worst deal on the market.
For savings, you’d get an above-average 2.5% on a 1-year fixed-term savings account and 3% on the 3-year version. The credit card charges 13% for everything – purchases, cash withdrawals and balance transfers, all without those sneaky fees charged by other providers. Again, the rates aren’t the best, but the simplicity and customer-friendly approach could be.
The key for Metro Bank is that it’s also pledged to offer fantastic customer service, promising to ‘surprise and delight every customer’. We’ve seen this approach pay dividends for First Direct, so Metro could be onto a winner with Londoners looking for a new current account with easy branch access.
With all of this in mind, would you switch? Personally, the small hit you take on interest in return for excellent customer service seems a worthwhile swap, so I might just be tempted.
Do you want your bank to be more like a shop, like Metro Bank?
Only if it doesn't affect the quality of its products (45%, 55 Votes)
Yes, customer service is key (34%, 41 Votes)
No, banks are fine as they are (21%, 25 Votes)
Total Voters: 121
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