RUTH SUNDERLAND: Nationwide boss spills the cash

The world of money is infested with fintechs, most of which seem to be run by young hipsters in dazzling white sneakers, with an app and an attitude.

These tech tycoons have probably never blacked out the door of a bank branch, let alone waved a ballpoint pen intent on writing a check.

They are digital natives to the extent that they boast that their toddlers are video game creators. But even if these fintech founders are geniuses, it takes other qualities to be a good banker: trust and social awareness.

Founded nearly 140 years ago, Nationwide may seem like a dinosaur compared to Revolut’s. In fact, the CEO, Debbie Crosbie, believes in keeping branches open because they are important to many customers and communities.

Along with other lenders, Nationwide has made profits thanks to rising interest rates. Revenues rose by more than £800 million and the profit margin increased significantly as rates skyrocketed.

That may seem shocking in the midst of a cost-of-living crisis, but Crosbie has returned £1bn to customers.

Now she’s literally giving away free money – £340 million – to eligible members. Nationwide can do this because it is a mutual accrual company, owned by its members and not accountable to City shareholders.

Mutuals have been under siege for three decades.

There was a craze to float the stock market in the 1990s when Halifax, Alliance & Leicester, Bradford & Bingley and Northern Rock became plcs.

Life on the stock exchange did not suit them, and in the financial crisis they all fell.

More recently, greedy carpetbag bosses tried to sell the mutual insurer LV to US private equity barons, but were thwarted by members after a campaign by this paper.

Fintechs can boast about innovation. But mutuality — the concept of ordinary savers clubbing together to raise money to build and buy homes and insure against illness and death — is one of the best ideas ever.

Lenders like Nationwide changed the face of this country by enabling millions of ordinary people to buy their own homes.

Mutuals aren’t perfect, but they’ve been just as revolutionary as social media and fintech – and cheaper.

Crack up

Hard as it is to empathize with Revolut’s travails, regulators aren’t covering themselves with glory over the never-ending application for a UK banking license. It’s not, as an increasingly vocal lobby of petulant entrepreneurs laments, because ‘irresponsible’ watchdogs create a ‘hostile’ environment in the UK.

They say inexplicable, I say independent. And it’s not hostile to insist that Revolut draw up a truthful and honest account before getting a banking license – it’s perfectly reasonable. This is the minimum that customers and taxpayers should expect.

It is incredibly rare for an accountant to ‘qualify’ a series of figures, as BDO has done.

Indeed, it should be taken very seriously, especially when it comes to a banking license, where the bar for trust is rightly set very high. What is not reasonable, however, is the way this has dragged on. Revolut has asked the bank several times if the application is a lost cause, but was told the process is ongoing. The Old Lady seems to be under political pressure.

But the whole point of independent regulation is to take decisions out of the hands of selfish politicians who may not fully understand the risks involved. If the Bank believes that Revolut doesn’t deserve a licence, it should have the guts to say so – regardless of the ministers who want to herald Brexit Britain as a fintech nirvana.

Allan checks out

The fallout from the CBI scandal has spilled over to Tesco, whose chairman John Allan, an ex-president of the group, has been pushed into an undignified exit.

This despite the fact that the supermarket group has not received any complaints about him and no abuses have come to light from an investigation. Allan denied three allegations and apologized for a fourth incident, an offhand comment about a CBI staffer’s dress matching her figure.

Women should not be subjected to toxic sexism at work. Still, it is disturbing that men are being punished not on the basis of guilt, but because accusations against them “threaten to become a distraction.”

That’s a new corporate euphemism, which carries its own risks.