Charter Savings to join UK challenger banks with online-only offering

online banking

Charter Savings Bank is due to join other UK challenger banks in the UK come spring as an online-only savings bank.

Charter Court Financial Services, a company backed by US activist investor Elliot Management, will likely launch Charter Savings Bank at the end of the first quarter of 2015. The online and telephone-only bank will offer instant access and longer term savings accounts as well as savings bonds, the Financial Times reports.

The new bank will have no branches, instead focusing on an online presence and call-centre, which will be open seven days a week.

Charter Savings Bank will sit alongside other offerings by the group, focusing on deposits, which will help fund the loans given by alongside the group’s mortgage business Precise Mortgages and its Exact brand, which uses credit and collections expertise to help established lenders analyse and service mortgage portfolios.

Chief executive of CCFS Ian Lonergan said that while there are no immediate plans to offer current accounts, they may be added “further down the line”.

A mobile phone app will probably be considered once the bank opens, keeping operating costs down along with online and telephone banking.

The UK’s banking industry has long been dominated by the ‘Big Four’ – Barclays, Lloyds Banking Group, HSBC and Royal Bank of Scotland – which hold 77 per cent of the personal currency account market.

But eight new banks have been authorised since April 2013, three others are going through the licence application process and two dozen institutions were in discussions with the regulator last year about applying.

Charter Bank said it will be covered by the Financial Services Compensation Scheme.