Monzo bank’s CEO Tom Blomfield is forgoing his salary for a year. Monzo is also offering voluntary furloughs to its employees.
Furlough is the process when companies can essentially ‘pause’ the contract of an employee without making them redundant.
This comes at a time when challenger banks are generally looking for multiple ways to deal with the COVID-19 damage.
CEO Tom Blomfield has sent a company-wide memo in which announced the bank’s over 1,500 staff that he won’t be taking a salary for the next twelve months.
He also mentioned that the senior management team and board have volunteered to take a 25% cut in salary as have other “Monzonaughts” within the company, according to TechCrunch.
Last week Monzo’s co-founder Blomfield addressed rumors circulating that Monzo was on the verge of bankruptcy and that it is not paying its staff. He said: “Monzo is not going bust. Source: I am the CEO.”
Another digital challenger bank, Starling, told to TechCrunch that it is furloughing 41 people and will top up their salaries to ensure they get 100%.
Very much like Monzo, Starling claims to be well-capitalized and just weeks ago it opened a third UK office, creating 400 data science, fraud and customer service jobs in Cardiff.
In contrast, Revolut said that it has no current plans to do so. The government’s furlough scheme is available to U.K. companies right across the board and several startups, including fintech, have already applied to furlough as a precautionary measure.
Sources: https://techcrunch.com/2020/03/31/monzo-ceo-wont-take-a-salary/ https://www.altfi.com/article/6376_monzo-and-starling-to-furlough-staff-amid-coronavirus-outbreak https://www.finextra.com/newsarticle/35553/monzo-and-starling-furlough-some-employees