A start-up bank that has no branches and encourages customers to manage their accounts on a smartphone has been granted a licence.

Mondo will become the latest challenger bank to try to shake up the industry after being given the green light by the Financial Conduct Authority and the Prudential Regulation Authority.

The regulatory backing means boss Tom Blomfield has now become the youngest chief executive of a UK bank at the age of 31.

“This is how the banking market changes, not with 800-page reviews from public bodies like the CMA, but with technology bringing new ideas to the table,” he said.

“The licence is a big achievement, the result of a lot of hard work from our team. But we don’t have time to dwell on it. We’re releasing new features every couple of weeks for our beta testers, and in the background we’re building our current account product.”

The London-based lender, which was launched 18 months ago and employs 45 people, is the youngest company to be granted a banking licence with restrictions.

Mr Blomfield previously founded GoCardless, the UK’s largest direct debit processor.

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