For years, people have talked about technology reinventing banking and financial services. Most banking, fintech, or tech events will have a keynote or a panel discussion on the topic, and while the technology/opportunity of the day changes (we used to talk a lot about mobile, these days it is more about GenAI), the same message surfaces over and over: the transformation is indeed underway, but the sector’s ability to embrace technical innovation is at best uneven.
One of the crucial components that continues to hold this transformation back is legacy technology - systems and processes that are so old and cumbersome that they struggle to deliver against the ever-evolving customer needs.
While legacy platforms might have been developed with some of the most impressive systems of that time, what matters more than specific technology choices is that you are able to change even the most fundamental pieces of your architecture as needed. A lot of legacy systems failed in that respect, they were just not set up for change. At the same time, outside of financial services, innovators like Google were proving that tech could really transform user experiences - and do so at pace.
The edge here is that leading tech companies build their own platform — just as we do at Monzo, the UK’s largest digital bank. This has become a core enabler of our mission and ambition of becoming the one app customers turn to when looking to manage their entire financial lives in one place. We have deliberately chosen to build most of our technology ourselves, using techniques that are new to the banking industry.
While we have strong partnerships with many companies and make good use of off-the-shelf technology where appropriate - alongside being heavy users of open source - we strongly believe owning our stack puts us in the best position to deliver the kind of experience that our customers want today and, importantly, that they will want in the future.
Features like our recent fraud-combatting Call Status tool are enabled by our architecture as our system can track the calls we make to customers in real time and update their app simultaneously. Another good example is that Monzo doesn’t have “scheduled maintenance” hours, during which some services are unavailable.
In short, the default user experience should be delightful and frictionless, with many things happening quickly and cleverly behind the scenes.
Building our own stack sets us up for success because it helps us achieve the following:
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Resilience: You need to offer digital services that not just work, but work well. Investing heavily in testing and automation means reducing the chance of defects, even though you cannot predict everything. At Monzo, we adopt a microservices architecture - where our application is developed as a collection of services. This is because we believe that a large number of individually simple and loosely coupled systems are more resilient than a small number of individually complex and tightly coupled components.
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Scalability: As you grow, you need a platform that will not constrain your goal and mission. There is a limit to how large a single server can be, so build systems that scale horizontally (by adding more servers), rather than vertically (by making single components larger). At Monzo, scalability is a core design principle. A good example is the need to manage significant spikes in customers wanting to use certain features at the exact same time, for example, when millions of our customers use our get paid early feature to bring payday forward by a day. Our systems are designed to work just as well with 100 million customers as they do for 1 million.
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Extensibility: In practice, this means that components can be added, changed, removed, and replaced continually – without downtime. We have optimised our engineering culture, tooling, and architecture to make the path from idea to production as frictionless as possible, all without sacrificing safety. This approach gets us the best of both worlds: less friction encourages smaller changes, and smaller changes are less risky. We are able to release more than 100 changes to our core systems every day on average!
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Security: We strive for best-in-class levels of security, nothing else is good enough for our customers. Our stack allows us to deploy a “defence in depth” approach where we layer multiple security measures on top of each other, so a vulnerability to one of our systems cannot impact our overall security.
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Cost effectiveness: As a business, we want to be efficient and manage our costs effectively. Our technology stack enables that well, as we have a high level of visibility into how our system operates end to end. This coupled with the ability to make changes anywhere in the stack gives us a lot of options when considering system-wide improvements. We also carefully consider the costs of building a system or tool in-house against the cost of purchasing from a third party and factor in scaling needs in those decisions.
At Monzo, we are building a global company and we believe our tech stack is instrumental in doing so. Building one market-leading product is incredibly hard. Building a separate one in many markets is even harder. Global technology leaders like Google or Apple have products that they can scale across the world, supported by a single platform. Expanding to new countries doesn’t mean “starting from zero” as your core technology foundations are already set, flexible and proven.
For our business, it means we have a platform that can adapt to different markets, languages, regulations, and multiple teams can make great use of. This gives us economies of scale and also the ability to centralise a lot of governance and assurance that is shared between areas.
We have big ambitions for Monzo and technology is a core part of our business DNA. When you put the two together, going all-in on your technology stack is really the only way to go.
Lead image via Monzo
About Matej Pfajfar
Matej Pfajfar is the Chief Technology Officer (CTO) of Monzo, the UK’s largest digital bank with more than 8.4m customers. He joined Monzo from Google where he was an
Engineering Director since 2018. Prior to that, Matej was the Executive Director of Adacta, enterprise software provider, where he worked for nearly 16 years and led the development of one of the top rated core systems for the insurance industry.
Matej brings 20+ years of industry experience having led development of software applications designed to streamline business processes, improve user experience and manage change effectively.
Most recently, at Google, Matej focused on using machine learning on Android-powered devices, expanding protected computing to transform how, when, and where data is processed to technically ensure privacy of data. He also led engineering and data science teams responsible for Android's telemetry and diagnostics platforms.
Matej holds a Computer Science degree from the University of Cambridge.
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