Four years after an unsuccessful bid to break into the US, Monzo is reportedly looking to revive its plans across the pond.
Two people familiar with the matter told The Financial Times that Monzo is aiming to apply for a new licence which would allow it to operate in the US.
Monzo is reportedly looking to the Office of the Comptroller of the Currency (OCC) for an operating licence that would allow it to become a regulated lender. It is currently unclear whether Monzo would offer similar interest rates on its savings accounts to those in the UK.
The OCC issues licences to incumbent banks and fintechs interested in becoming operating lenders via its Federal Savings Associations (FSA) licence. The agency also grants charters to enable interested parties to become national banks and licences for Federal Branches and Agencies of Foreign Banks.
Monzo executives, according to sources from The Financial Times, believe it is likely to be granted its FSA licence due to the deregulatory stance of President Donald Trump.
Bloomberg reported on May 7 that over 2,300 jobs at the OCC, as well as the Securities and Exchange Commission and Federal Deposit Insurance Corporation, were set to be cut in a bid to remove regulatory burdens and incentivise financial growth for US companies.
Tight regulation on US banking licences was one of the primary reasons Monzo pulled out of the application process in 2021.
The UK digital bank had worked with relevant US banking authorities for 18 months on the process of securing a banking licence. However, the OCC under the Biden Administration noted to Monzo its application was unlikely to be successful.
New wave of US interest: Checkout.com and Coinbase
Monzo is not the only financial institution to have filed interest in launching its services in the US to the OCC.
On October 3, Checkout.com confirmed it expanded its presence in the US by acquiring a Merchant Acquirer Limited Purpose Bank (MALPB) charter in the state of Georgia. The MALPB charter application, once approved, will allow Checkout.com access to US card networks, enabling it to act as its own acquirer.
“The Georgia MALPB charter is a pivotal moment for our business, marking a ‘line in the sand’ in our commitment to the US,” said Guillaume Pousaz, CEO and Founder of Checkout.com.
“Just as our UK acquiring licence in 2012 was a catalyst for our business, we see this as the definitive accelerant for our growth in the US. The US is already our fastest growing region, and we firmly expect it to become our single biggest region globally by the end of 2027.”
Coinbase also announced on October 3 it is “seeking” a National Trust Company Charter from the OCC, but explicitly stated it had “no intention of becoming a bank”.
Rather, Coinbase intends to use the charter to expand its custody business, as well as to launch new products and services, including payment-related services backed by regulatory clarity.
“An OCC charter will streamline oversight for new offerings and enable continued innovation to integrate digital assets into traditional finance. We’re not the first crypto company to seek a federal charter and we won’t be the last,” said Coinbase in a statement.
Furthermore, Latin American companies are also interested in expanding into the US. Nubank, the largest neobank in LatAm, confirmed on September 30 it applied for a national bank charter with the OCC to “unlock new possibilities within the US financial landscape”.
