Here are the UK’s 5 leading banking-as-a-service providers

By Oliver Smith on Tuesday 3 March 2020

Digital Banking

It’s never been easier to build a bank.

Here are the UK’s 5 leading banking-as-a-service providers
Image source: 11:FS founding team Jason Bates, David Brear and Simon Taylor.

Starting a bank used to be a painstaking process, with many having to craft an entire banking technology stacks from scratch.

Luckily the digital banking boom has given rise to a host of so-called banking-as-a-service providers, where banking capabilities can now be rented and spun-up in weeks rather than months.

Household names like Lloyds, Mastercard and RBS are all using banking-as-a-service to build and deploy new features and services without having to develop the technology in-house.

But which UK players are leading this space?

Thought Machine

Who started it?

Founded by former Googler and serial entrepreneur Paul Taylor in 2014, Thought Machine’s main product is its core banking platform Vault, that handles things like current account balances, transactions, savings, loans, credit cards and mortgages.

Though Machine hit the headlines this week as part of a new funding round led by Draper Esprit which will see the business grow and soon expand to the US.

How is it funded?

This week Thought Machine secured an additional $83m (£64.75m) as part of its Series B funding round, bringing the total amount raised by the business to over £82m.

Who are the customers?

Among Thought Machines’s core banking customers are Atom Bank, Lloyds Banking Group, Standard Chartered and Nordic corporate bank SEB.

Starling Bank

Who started it?

Founded by Anne Boden in 2014, Starling Bank is primarily a retail challenger bank going head-to-head with the likes of Monzo and Revolut. 

In 2018 Boden announced the bank would also be opening up its APIs for other companies to start using its payment rails and eventually full current account support with KYC/AML checks.

How is it funded?

Starling recently secured an additional £60m from its existing investors, taking the bank’s overall capital raised to over £323m.

Who are the customers?

Starling’s customers include Raisin, SumUp, Square, Flux, Mastercard and the UK’s Department for Work and Pensions.

Bankable

Who started it?

Founded in 2010 by Eric Mouilleron, Bankable similarly to Starling began life as a payment services provider but has since expanded into the whole of banking-as-a-service.

Today Bankable offers virtual ledgers, for corporates who want to streamline their existing accounts across multiple banks, as well as digital banking services like current accounts, faster payments, etc.

How is it funded?

Last year Visa made an unspecified “financial investment” in Bankable, the size of which has not been disclosed. So far Visa is the only reported outside investor in Bankable.

Who are the customers?

Bankable counts customers including Spendesk and ABN Amro, though its Money You brand.

11:FS Foundry

Who started it?

Started by David Brear, Jason Bates and Simon Taylor in 2016, what began as a challenger fintech consultancy has grown into a fully-fledged banking-as-a-service provider and media empire with its popular podcasts brands.

It’s 11:FS Foundry was established in 2018 as its own company, led by CEO Leda Glyptis, offering a host of banking products from current accounts to loans and wealth management

How is it funded?

Last year Norweigan financial giant DNB said it would “extend” an existing £3m investment in 11:FS, and remains the bank builder’s only outside investor.

Who are the customers?

11:FS’s most high-profile customer is RBS, which turned to the team to help build its business challenger bank Mettle, but DNB is 11:FS Foundry's first customer as well as an investor.

ClearBank

Who started it?

Launched by Nick Ogden in 2017 as the first regulated clearing bank to enter the UK market in 250 years, ClearBank’s core banking, clearing and settlement services were built in partnership with Microsoft.

How is it funded?

ClearBank launched with £25m PPF Group and CFFI Ventures in addition to investments from the founding management team. Last year ClearBank was awarded £60m from the Banking Competition Remidies fund in partnership with SME banking app Tide.

Who are the customers?

Tide, unsurprisingly, along with OakNorth, Dozens and Nationwide Building Society.

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