Monzo and TrueLayer use open banking to protect customers

By William Girling
Digital bank Monzo and open finance tech expert TrueLayer have partnered to create a new ‘gambling block’ for vulnerable customers...

Monzo first instigated a ‘block’ feature for its app in 2018, apparently to meet the demand of customers who wished to tackle issues related to gambling addiction.

Subsequently, 275,000 of its five million users have reportedly activated the function and less than 10% have deactivated it. However, the evolution of payment methods for online gambling using open finance tools has meant that prior protections are no longer robust enough. Monzo’s collaboration with TrueLayer is an attempt to redress the balance.

Protecting vulnerable customers

The previous incarnation of Monzo’s protection would block payments to particular ‘merchant codes’ (assigned on card platforms like Mastercard or Visa) linked to gambling companies. 

This still works well, however new methods for payment, such as those powered by open banking, bypass the protection by dispensing with a card platform intermediary and allowing a direct consumer-bank authorisation. 

Through an enhanced API, TrueLayer can overcome this issue by notifying Monzo any time a user with gambling restrictions on their account attempts to pay with open banking. TrueLayer described the solution as “relatively straightforward”, yet with the potential to have a significant impact in helping those who require support. 

Making gambling more responsible

Following a statement from Monzo’s new CEO TS Anil earlier this week, it appears that the leading digital-only bank is taking a firm stance on making gambling a more managed activity.

“We believe the government should take the opportunity afforded by the [2005] Gambling Act review to make sure every consumer in the UK can access these blocks, regardless of who they bank with.

“These tools are simple to build, proven to work, and will help protect hundreds of thousands of people.”

According to Statista the gross gambling yield in the UK last year was roughly £14bn, with 31% of the population gambling on a weekly basis. As such, talks about how best to protect consumers in an age where digital payments make the activity easily accessible are ongoing.

TrueLayer concluded its announcement of the Monzo partnership with a positive affirmation, “By enabling the right types of protections for all players, gambling can remain a purely social activity, rather than one with life-altering negative effects.” 

Share

Featured Articles

Interview: We asked a chatbot what it thought about chatbots

We interviewed ChatGPT, the text-based chatbot taking the internet by storm, about the future of artificial intelligence (AI) in banking and finance

The challenges of address data in cross-border payments

A truly global solution is critical to meeting cross-border needs at scale, writes Loqate, a leading developer of global address verification solutions

Top 10 fintech disruptions to watch out for in 2023

From new technologies to tough regulations for crypto, 2023 is already looking like a year of change for fintech.

PBF CEO, Morgan McKenney on blockchain, DeFi & tokenization

Crypto

UAE-based BNPL fintech Tabby secures $58mn in Series C round

Digital Payments

Why seamless cross-border payments transform transactions

Digital Payments