HSBC is planning to launch a new digital entity in a bid to bolster its online presence.
According to The Daily Telegraph, the lender has already hired more than 100 people to work on this initiative called ‘Project Iceberg’.
A person familiar with the matter said the stand-alone HSBC digital bank will be launched later this year in beta.
However, a HSBC spokesperson declined to comment on the initiative.
Digital banks sweep the UK
Once launched, the HSBC digital bank will against established online lenders in the UK such as Monzo and Starling.
Other UK-based banking giants RBS and Santander are also working to create separate digital entity to tackle growing competition in the online domain.
The report added that the government-controlled RBS is working to launch a digital bank from it offices in Piccadilly.
The stiff competition from digital-only lenders and changing banking habits of the consumers said to have compelled the conventional lenders to boost their digital presence.
Since its launch, Monzo has increased its customer strength to nearly 900,000 users. In addition, Starling has apparently more than 200,000 customers.
Last month, HSBC announced plans to shift its two European subsidiaries to HSBC France from the UK owing to Brexit.
As the bank’s Polish and Irish arms prepare to move, other subsidiaries are also expected to be relocate.