HSBC is close to launching a new digital bank known internally as “Project Iceberg” in a move to sink new competition from online upstarts. Europe’s largest lender has recruited more than 100 people to the secret project, based in offices in the Aldwych area of central London.
A source close to HSBC said the stand-alone digital bank was expected to focus on small business customers and could launch as early as this year in “beta” testing mode.
HSBC joins high street rivals RBS and Santander in the race to build separate digital brands to fend off competition from fast-growing online rivals such as Monzo and Starling. Any big push by HSBC into online business banking would also shake up the market at a critical time.
Smaller rivals including Clydesdale and Metro Bank are jockeying for an ￡833m fund stumped up by RBS to boost competition and placate regulators, with the contest starting in November.
A HSBC spokesman declined to comment on specific plans, but said: “We are always exploring ways to make commercial banking quicker, easier and more convenient.