Thought Machine empowers Mox Bank by building a cloud native platform, thereby bringing agility, security, and convenience to its customers.
IBS Intelligence

A new era in banking

Many banks have the ambition to deliver better digital services to their customers but are held back by legacy platforms and outdated technology. The cost of upgrading legacy systems is onerous preventing banks from achieving the full potential of end-to-end digitalization.

Hence, Mox, a virtual bank in Hong Kong backed by Standard Chartered, wanted to be a cloud-native, mobile-only, digital bank, which was unhindered by any legacy technology constraints of the past. The firm knew that it needed an advanced core engine that could power an all-new greenfield bank surpassing all competitors in terms of functionality and usability.

They wanted to assemble a secure, flexible platform made up of best-in-breed solutions that could be deployed quickly, would allow for ongoing adoption of new technologies, and supported a culture of microservices. Thought Machine was chosen by Mox for this undertaking.

Thought Machine’s cloud native core banking platform, Vault, enables banks to deploy modern, cloud-based systems and move away from the legacy platforms. Operating in the cloud enables the banks to provide highly adaptable, reliable services. Incumbent banks are hugely interested in a cloud-native banking system as they can integrate various best-in-class solutions with enhanced security and low downtimes.

Project and Solution Details

Standard Chartered approached Thought Machine to help launch a bold new banking experience in Hong Kong: Mox Bank. Mox built a digital-only platform using Thought Machine for its core banking systems, running on AWS Cloud Services. Utilizing Vault’s smart contracts system, Mox was able to deliver product updates significantly faster than banks operating on legacy technology.

The initial product offerings included current and savings accounts, with overdraft facilities and cross-product loyalty scheme management. This was followed by foreign currency denominated accounts, and an innovative credit card product. This one was integrated with the existing deposit card to enable one card to offer debit and credit services, in addition to a “loan on card” product, an individual micro loan credit line available as cash or at point of sale / purchase. The initial beta offering was launched within eight months, with a full market launch within 12 months of project commencement.

• A powerful Smart Contract product building system allowing banks to create any type of new product.
• Seamless test migration capabilities.
• Wide scale of customization options without having to change anything in the underlying platform.

Implementation Process

The bank progressed swiftly from licensing to deployment in less than 18 months. An ecosystem of partnerships enabled smooth collaboration throughout the project. These included infrastructure cloud provider AWS and system integration partners.

An agile and adaptive cross partner governance framework, with the ability to adjust as needed, was a central feature of the project. Thought Machine and Mox Bank teams continued to work cohesively, with multidisciplinary Thought Machine teams being leveraged to quickly resolve issues and drive progress. A real-time API and microservice-first architecture enabled the efficient build of new bank services, together with the ability to quickly pivot and change the technology setup as project needs evolved. A close partnership between Mox Bank and Thought Machine was key to the success of the project, with both sides providing subject matter expertise to enable the Mox Bank to leverage the latest product improvements.

Benefits Achieved

Driven by Thought Machine’s Vault, Mox Bank has become a Tier one bank in Hong Kong by market share and deposits. Vault allows its clients to develop financial products as code using Thought Machine’s smart contracts system. Whereas other vendors might tightly control the customisation, deployment, and (most critically) any updates of their products; smart contracts gave Mox direct ownership of the products, allowing them to make changes without having to wait for implementation partner to intervene. Utilizing Vault’s smart contracts system, Mox was able to deliver product updates significantly faster than banks operating on legacy technology. Some of the other benefits achieved included:

• Deployment of a modern, cloud-native systems, unhindered by any legacy platforms.
• Quick-to-market new product delivery using Thought Machine’s product library.
• Scalability and high availability features that are beyond the capability of legacy data centers.
• Over 230,000 new customers as of Feb 2022.
• More than 25% market share of deposits among virtual banks in Hong Kong.

Conclusion

A new Mox customer can be onboarded in under three minutes – a testament to the company’s goal of providing exceptional, real-time services across its customer facing products. Mox delivers this high-standard service by leveraging event-driven architecture on AWS to prioritise activities and by using smart contracts in Thought Machine’s Vault to update applications quickly. By building on the cloud, Mox was able to start small and operate the bank at a substantially lower cost base, but with technology that can scale as customer numbers grow. Going forward, Mox Bank expects to provide Hong Kong customers with increasingly services and features.

Key Facts

Supplier: Thought Machine
Headquarters: United Kingdom
Founded: 2014
Client: Mox Bank
Solution: Vault