Launching a bank in times of crisis is no easy feat. Yet Lily Lapenna, founder and CEO of MyBnk, was not deterred. On the contrary, her MyBnk venture has been forging ahead now for 5 years and has already notched up 30,000 depositors in the UK. The secret of its success: the bank has targeted a very young demographic. MyBnk is in fact a “social enterprise”, a non-profit firm that aims to provide its novice customers with an entrée to the world of banking, by educating and furnishing them with small loans to finance business ideas. Born in London in 1980 to Italian parents, Lapenna’s formative experiences were in her hometown and working on volunteer projects around the world. In an interview granted to the Aspen Italia website, she explained the background to MyBnk.
What is MyBnk and how does it work?
MyBnk is a non-profit organization geared towards young people aged between 11 and 15 years. Its main objective is to give them firsthand experience with and educate them in how the savings and lending market works. On the one hand, we take deposits, and on the other, we provide small interest-free loans to enable kids to set up their first business undertaking. The amounts are very small, but it is the educational element that is most important, giving them guidance in setting up a business venture. Our Mybnkers play a key role in this. They are also quite young, and we train them in receiving and lending money, so that they are in turn able to pass on these skills to their peers.
And what has been the response from your budding customers?
We’re working with a number of schools in London and we’re opening MyBnk branch counters every week. The response has been excellent considering there are often very long queues of kids who want to deposit their savings. The same goes for loans, where the repayment rate is very high, close to 98%. Some youngsters come to us already with clear ideas and a keen interest. In general, however, most of them are very concerned about the future. Levels of disaffection among young people in the UK are at their highest since the 1980s, and the rise in education costs has been accompanied by cuts in government allowances. This generation, more so than those before, is in need of financial education. Our aim is to plant little seeds that can take root in a wide variety of circumstances.
How did the idea of MyBnk come about?
I’ve always liked to come up with plans and follow them through, and at 18 I decided to go to Africa to do volunteer work with kids in small rural schools. But the turning point came after my university studies at the School of Oriental and African Studies (SOAS). I spent a year in Bangladesh, where I came across microcredit and Muhammad Yunus’ Grameen Bank. Once I was back in London, I decided to use this experience for the benefit of young people in the UK, and in 2007 I established MyBnk in an area of East London noteworthy for its multicultural community.
After the success in London, what are your plans?
We have six branches in London, and in the coming years, our goal is to expand to other parts of the UK. There is a lot of international interest in what we’re doing, and we will continue to provide advice to the organizations concerned. Even in Italy, for example, a project has been set up in conjunction with the Banca Etica Adriatica that was inspired by MyBnk. The interest stems from the fact that, in recent years, the banking industry has innovated a lot in the area of risk, but little in the creation of products and services for its customers, particularly those at the younger end of the scale. The newer generations have a different, more rapid way of interacting with the savings and lending market, so more attention needs to be focused on them. As MyBnk has demonstrated, you only have to engage young people to get an enthusiastic response.
