The chief executive of app-only startup bank Monzo is waiving his salary for 12 months due to the coronavirus pandemic.
TechCrunch reported on Tuesday that Tom Blomfield had told staff in a memo that he was forgoing pay for a year. Other senior managers and board members will also voluntarily reduce their pay by 25%.
Monzo wouldn’t comment the report or say how much Blomfield earns. Accounts show the company’s highest paid director made £117,000 (£144,875) last year, but it is not clear who that was.
Almost 300 Monzo staff have also been asked if they would consider being put on the government-backed furlough scheme, TechCrunch reported. Monzo declined to comment.
Founded in 2015, app-only bank Monzo has more than 4 million customers in the UK. It was valued at over £2bn last year.
The salary cuts and furloughing come amid a slump in economic activity across Britain caused by the coronavirus pandemic. Last week, Boris Johnson ordered all non-essential shops to shut and told the public to stay indoors as much as possible.
Bank of America said on Tuesday that a survey of UK consumers this week found 34% had stopped working due to coronavirus, “either sick, furloughed, laid off or company closed.”
Read more: World Bank warns of COVID-19 economic pain
Sectors like travel and hospitality have been the worst hit but all parts of the economy are feeling the squeeze. A slowdown in consumer spending is likely to lead to lower revenues for banks like Monzo, which makes money when people spend on cards or take out products like loans.
Monzo said in a blog earlier this month: “Coronavirus could have an impact on your financial situation.”
“We're here to help if you're in financial difficulties,” Monzo’s vulnerability manager Natalie Ledward wrote.
Chief executives around the world have been reducing or forgoing pay in response to the coronavirus crisis, although action has so far been limited in the financial sector. One of the few examples besides Monzo is Santander, where the chair and chief executive both cut their pay by 50% and pledged the money towards efforts to fight COVID-19.