Chase UK aims for profit in 2025 as digital bank grows ‘rapidly’

2 January 2024, 10:14

Chase UK aims for profit in 2025
Chase Bank. Picture: PA

The digital bank, owned by US giant JP Morgan, has amassed more than two million customers since launching in Britain in 2021.

Chase UK could start becoming profitable as soon as next year, as the bank is striving to be a “major player” in Britain as people hunt for better returns on their savings.

The digital bank, owned by US giant JP Morgan, has amassed more than two million customers since launching in Britain in 2021 and manages around £15 billion in deposits.

Managing director Shaun Port told the PA news agency that the UK spin-off is growing quickly and could begin to be profitable from 2025.

It comes after JP Morgan’s president Daniel Pinto revealed in November that he expects the UK consumer bank to break even in the next 12 to 18 months, at least two years earlier than previously expected.

JP Morgan had warned that losses from the UK digital bank would be about 450 million US dollars (£352 million) in 2022, and estimated a similar amount for the following years until it begins to generate an income.

Mr Port told PA: “We’ve been building the bank rapidly, so we believe that we can bring the UK business to profitability in 2025.

“We want to be a major player in the UK banking scene, and to do that, we obviously need to make banking with Chase compelling.”

Starting the UK bank from scratch has allowed it to be technology-led and save on costs associated with running legacy systems and manual processes, he said.

Chase continues to be “efficient” and “careful on costs” as it hopes to swing the loss-making business to profit.

Furthermore, Mr Port said the bank has made a concerted effort to tell customers when it is changing its savings rates, usually on the day that the Bank of England has announced it is hiking interest rates.

This communication has “built trust” in the bank, which currently offers 4.1% interest on its saver account, he said.

It comes as consumers see building their savings as a top financial goal for 2024, with 30% of people saying so, according to a survey conducted by Chase.

Mr Port said there is a “clear desire to be more resilient” among customers, with people more actively managing their finances, including by transferring their monthly salary into accounts with higher interest and then moving money out to cover major bills.

“The banking sector is in good health, but people can do more to earn more from their money, rather than just leave it with their existing provider and getting very little on their savings,” he said.

Nearly a fifth of consumers see paying off debts as a top goal, while 18% are focusing on building an emergency fund, according to the same research.

Meanwhile, Chase UK is set to offer credit cards this year as it looks to further expand its consumer products.

“That’s going to broaden our offer because having a credit card is really important to our customers; we have a lot of people asking when we’re going to launch, so we’re looking forward to getting it out there,” Mr Port said.

It is also set to grow beyond the UK and the US and has been building a team in Berlin, amid reports it is planning to launch in Germany and other European Union countries.

By Press Association

More Technology News

See more More Technology News

National Cyber Security Centre launch

National Cyber Security Centre names Richard Horne as new chief executive

The lights on the front panel of a broadband internet router, London.

Virgin Media remains most complained about broadband and landline provider

A person using a laptop

£14,000 being lost to investment scams on average, says Barclays

Europe Digital Rules

Meta unveils latest AI model as chatbot competition intensifies

AI technology

Younger children increasingly online and unsupervised, Ofcom says

Migrant Channel crossing incidents

Ministers will be told to use AI to screen migrants for threats, adviser says

Nothing smartphone

UK tech firm Nothing to integrate ChatGPT into its devices

The Google offices in Six Pancras Square, London

Google confirms more job cuts as part of company reorganisation

Person using laptop

Housing association reprimanded after residents’ data compromised

A screengrab of an arrest in connection with the LabHost website

Arrests made and thousands of victims contacted after scammer site taken offline

Social media apps on a smartphone

Three-quarters of public fear misinformation will affect UK elections – report

Businessman racing with a robot

TUC calls for AI to be regulated in the workplace

The ChatGPT website

AI chatbot ‘could be better at assessing eye problems than medics’

FastRig wingsail launch

Scottish-made wingsail set for sea tests after launch on land

Immigration

Rollout of eVisas begins as Government aims for digital immigration by 2025

Elon Musk in 2024

X may start charging new users to post, says Elon Musk