Legacy banks must ‘radically modernise’ or lose to fintech stars, says former Barclays boss
A decade ago, Antony Jenkins was ousted from his role as chief executive of Barclays and months later warned the banking sector was reaching an “Uber moment”.
Jenkins declared technology would be an “unstoppable force” in the banking sector and could lead to hundreds of branch closures and potentially slash the industry’s workforce by half.
In the ten years that followed, banking giants culled their branch network.
The Office for National Statistics (ONS) showed that the number of bank, credit union, and building society branches in the UK stood at 12,680 in 2015.
This number fell to 10,410 in 2019 and to 6,870 last year, marking a 46 per cent decline from 2015.
But as banks shifted strategy to meet the digital age, a new threat emerged with the explosive rise of the UK’s fintech scene. Monzo and Revolut publicly launched in late 2015, with Starling following suit in 2017.
Now, as he turns to the battle lines that will define the banking landscape for the next decade, Jenkins – who spent nine years at Barclays with three at the helm – handed banks a stiff warning to “radically modernise” or risk losing market share to the UK’s fast-growing fintech stars.
Britain’s banking giants have already felt the rising pressure from neobanks, digital-only financial technology firms providing banking services.
“There will be winners and losers and I’m not calling the end of the legacy banks – I think that would be foolish,” Jenkins told Morning Wire.
“But what I am calling is that they are going to be under a lot of pressure in the coming years and the response to that is, in my view, to radically modernise their technology.”
Banks outdated systems can’t compete
The construction of fintech firms from the bottom up over the last few years is set to give those looking to leverage modern tech an edge, Jenkins said.
“They’ve all basically been built around modern technology and real type data,” he said.
“And so they’ve got a natural advantage here versus the incumbents who are struggling with these very old systems.”
Jenkins added that fintechs were not “hemmed in” by “30, 40, 50 years old” systems, allowing them to adapt faster and positioning them better for the shift into artificial intelligence.
“That’s going to put a lot of pressure on the incumbents in the coming years.”
The UK’s big banks have ramped up efforts in the last year to utilise AI, with Natwest’s landmark partnership with OpenAI and Lloyds introducing its own AI Centre of Excellence led by former Amazon AI boss Rohit Dhawan.
A number of banking giants have used deals to snap up challengers, consolidating their market shares and enhancing capabilities.
In October, Barclays snapped up personal loans fintech Best Egg in a bid to grab a slice of the US consumer finance market.
But Jenkins – who now runs cloud-native core banking platform 10x – cautioned that lender acquisitions shouldn’t be at the forefront until banks find firmer footing with their tech.
“I wouldn’t be looking to make any acquisitions at all,” said Jenkins.
“What I’d be looking to do is dramatically modernise my operations and technology, get off all of these 30-year-old systems, and get onto some modern technology that would allow me to compete very effectively.”
Jenkins predicted fintechs would “double down” on the “parts of the business that are very profitable for banks” in the new year as lending becomes the “new battleground”.
“That is where, again, the effective and sophisticated application of artificial intelligence to make better lending decisions could really advantage the fintechs,” he added.
He anticipated a sharp rise in the automation of mortgage lending, small business lending and unsecured lending with “better data and the ability to apply algorithms”.
Adapt or fall behind
The measurement of the ‘challengers’ success is often viewed through fintech’s ability to poach customers off incumbents.
Monzo has fired up its customer base, notching 14m users by late 2025 – a 40 per cent year-on-year increase.
Meanwhile, Revolut – which analysts have hailed as the “gold standard” among fintechs – has collected customers across the globe, surpassing HSBC and Barclays after reaching 65bn.
Jenkins said banks must go further to drive radical change or “find [themselves] gradually seeding around and losing share”.
The latest customer figures from the current account switching service Pay.UK showed over 22,000 users switched from Barclays in the three months to June 2025, with just under 4,000 joining, giving the firm a net loss of over 18,000. Santander, which came second, recorded a net loss of 23,015.
Monzo recorded a net gain of over 8,000 customers. Building society giant Nationwide topped the rankings for the most new customers at 54,000, as it sweetened its offers for new joiners.
It came as both Barclays and Santander were hit with major tech outages that disrupted thousands of customers’ online banking.
Barclays wrote in a letter to the Treasury Committee earlier this year that it expects to pay up to £7.5m in compensation to customers after a three-day outage.
Figures from the committee revealed Brits were hit with almost 33 days worth of unplanned tech and system outages in the last two years.
Don’t get IPO hopes up
Beyond the battle with banks, fintech firms have kept the City abuzz with speculation around an influx of listings.
Earlier this year, after reports started to swirl that Monzo was calling in bankers to advise on a £6bn blockbuster float.
Meanwhile, Revolut secured a $75bn (£56bn) valuation in 2025 following a secondary share sale, which included investment from Nvidia.
This put the firm briefly ahead of Barclays’ market cap – albeit in separate private and public markets – before the firm enjoyed an end-of-year rally to near £66bn.
CS Venkatkrishnan, Barclays’ chief executive, said Revolut had “laid the gauntlet down”, though in the same speech he took a jab at the firm’s “financial controls” following its banking licence debacle.
Responding to the remarks, Revolut said it abides by the same regulatory and consumer protection standards as any traditional bank.
Jenkins said there wasn’t “necessarily anything to infer from” Revolut’s new price tag.
“High growth companies have high valuations…. that’s why NVIDIA is the most valuable company in the world,” he said.
“If you were to infer something, it would be that there was a different view of the growth prospects for those organisations.”
The boss of Revolut Nik Storonsky poured cold water over hopes of a London listing in 2024 stating it was “not rational” when compared to the deeper liquidity offered overseas.
“I’m not predicting a flurry of IPOs in the fintech space anytime soon,” Jenkins said.
“There may be one or two, but I don’t think it’s going to be a flood.”