Challenger banks are small, recently-created retail banks in the United Kingdom that compete with the longer-established banks in the country, sometimes by specialising in areas underserved by the "big four" banks (Barclays, HSBC, Lloyds Banking Group, and Royal Bank of Scotland Group). As well as new entrants to the market, some challenger banks were created following divestment from larger banking groups (see TSB Bank (United Kingdom)) or wind-down of a failed large bank (see Northern Rock).
The banks distinguish themselves from the historic banks by modern information technology practices, such as online-only operations, that avoid the costs and complexities of traditional banking. In order to be defined as a "bank", the company must be authorised to accept retail deposits by the UK financial regulator the Prudential Regulation Authority (PRA).
List of challenger banks
This list contains notable companies that have received PRA authorisations to operate as banks in the UK:
- Atom Bank
- Metro Bank
- Starling Bank
- Tesco Bank
- TSB Bank
- Virgin Money
- "Challenger bank". OxfordDictionaries.com. Oxford University Press. 2017. Retrieved 18 August 2017.
- Wallace, Tim (29 December 2015). "Are challenger banks the saviours of British banking?". The Daily Telegraph. Retrieved 18 August 2017.
- Burd, Tristan (20 March 2015). "Are Challenger Banks Disrupting Banking?". Market Mogul. Retrieved 18 August 2017.
- Flinders, Karl (21 Jan 2015). "Six challenger banks using IT to shake up UK retail banking". Computer Weekly. Retrieved 18 August 2017.
- "New Bank Start-Up Unit | Bank of England". www.bankofengland.co.uk. Retrieved 2018-07-17.
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