Mox’s product expansion and technology initiatives increase customer base

Mox by Standard Chartered is a Hong Kong-based virtual bank that began operations three years ago in September 2020. In 2022, its reported operating income was HKD 170 million ($21.7 million), up from a loss of HKD 7.7 million ($0.98 million) in 2021. Customer deposits increased by 56%, reaching HKD 8.4 billion ($1.07 billion), while customer loans and advances soared sixfold to HKD 5 billion ($638 million) in 2022. The bank also increased its deposit market share of virtual banks here to 28% in 2022, up from 21% in 2021.

David Walker, the bank’s chief data, security and innovation officer, shared key initiatives that drove this growth. The bank expanded its range of services to include current and savings accounts, credit cards, payments, loans and time deposits. Competitive features include daily interest rates on deposits, personalised goal savings accounts, real-time spending insights and its single card for cash withdrawal and purchase.

Earlier this year, the bank enhanced the Mox Credit suite with the addition of ‘4-in-1’ onboarding for loans that allows customers to open an account, receive a credit card, apply for loans and other services, all within a few minutes. These offerings enabled Mox to grow its customer base to grow its customer base by 1.3x year-on-year to reach 450,000 in the first six months in 2023.

Walker offered that this year’s focus would be on expanding into wealth management services. He explained: “We obtained the licence to become the first virtual bank in the city to launch Hong Kong and US equity trading services under Mox Invest, and we are in sandbox testing for this service.”

Walker attributes the bank’s success to diligent cost management, saying: “We focus on our cost with almost military precision. Despite the doubling of our customer base annually, the bank has maintained the same cost base, resulting in decreased cost-to-serve per customer. This allows us to pass on savings and competitive rates to our customers.”

Mox is fully cloud native, with a cloud-based core banking system that can scale development, test environments and loads, ensuring stability with steady costs. Alongside, it has implemented storage solutions for resilient services, automation and process optimisation to improve efficiency in the end-to-end customer journey. Walker shared that the average customer onboarding time is approximately five minutes, with over 70% of applications being processed straight through, including all necessary checks and verifications.

Given the increasing number of customers, the bank has wider access to customers data including their transactions and behavior that it plans to leverage. It uses artificial intelligence and machine learning across various areas, such as cybersecurity, behavioural analytics, and credit risk to enhance business decisions.

The bank claims to be on track to achieve profitability by 2024. Mox was launched in partnership with HKT, PCCW, and Trip.com.