According to the Competition and Markets Authority, 85% of SMEs bank with either Barclays, Lloyds, HSBC, NatWest and Santander. This is a surprisingly high figure given the numerous pain points we often hear from businesses about banking with these institutions: legacy technology and outdated processes mean trying to get what you need is way more complicated than it should be.
You’re treated like a new customer when it comes to opening new accounts or applying for new products, even if you’ve been a loyal customer for several years; products are served up like a menu without any contextualisation or personalisation to your business; you’re bounced around different teams and individuals; your calls and emails often go unanswered for days or weeks; and you experience hidden fees and uncompetitive rates.
At OakNorth Bank, we know from our experience of lending to hundreds of property businesses and SME housebuilders since our launch in September 2015, that a particular pain point for them is when they set up a special purpose vehicle (SPV) for a new project. A high-street bank will make them apply for a new account – a process that typically takes months, even if they’ve been an existing customer of that bank for decades. Why can’t banks take a more logical approach, noting that if a customer already has an account with them, the necessary due diligence checks must have been done, and therefore work with the business to open a new account for the SPV quickly? This would mean the business could get back to progressing their project without delay, and the management team doesn’t waste valuable time on phone calls with the bank.
Another pain point that’s often raised from our customers in this sector is around transaction values. At times, they may try to make a large payment for their next investment such as a down payment on a property, but their bank will often block these, citing fraud risk given the size of the transaction and history of transactions on the account. They may even say the business’ director has to come into the branch to verify the payment. Why can’t banks recognise that these kinds of transactions are very normal for the sector, so reduce this friction and work with the business to ensure the payment happens quickly?
These are questions our customers have asked us numerous times over the years, and are why we’re expanding from just lending, to a holistic banking offering with current accounts, savings accounts, cards, payments, etc. We’ve worked with some of the best-known property businesses in the UK – names such as Galliard, Frogmore, Hayfield Homes, Arora Group, Bruntwood SciTech, and Scarborough Group International – and want to help businesses like these make the most of their money, and ensure their banking is enjoyable and rewarding.
Working alongside Founders, CFOs, CEOs, and Directors of property businesses, we’re building an offering from the ground up, that scales with businesses and their aspirations, and that addresses their unique pain points such as those outlined above. We’re assigning each business a dedicated OakNorth Business Partner – someone they can call or email whenever they have a question. We’ll also be offering a competitive rate of 3.85% AER on easy-access accounts.
If any of what you’ve read today resonates, please sign up to our waiting list via this link to be part of our phased Beta launch, and help us build a banking proposition that works for property businesses like yours.
I have never had this kind of experience with any lender in my life – I have been so impressed by the speed and transparency with which OakNorth operates. If the major clearing banks want to learn about how to genuinely do things differently, they should be looking at OakNorth.” – Surinder Arora, Founder and Chairman of Arora Group
[OakNorth’s] experience gained from working with some of the leading property developers really shone through during the entire lending process, allowing us time to invest in areas where our own expertise and passion can make the most impact.” – Kate Lawlor, CEO of Bruntwood SciTech
We were impressed with the speed and transparency with which the [OakNorth] team works, as well as their commercial and entrepreneurial approach.” – Kevin McCabe, Chairman of Scarborough Group International