MarketFinance, Virgin Money, Ebury, Tide and ClearBank scoop BCR’s final £80m

Starling Bank, Cashplus, Curve and Assetz Capital among those missing out.

Five fintechs have been awarded a collective £80m from British Competitions Remedies (BCR) Pool E fund, with individual awards of between £10m and £35m each.

Lending platform MarketFinance and trade finance group Ebury both picked up £10m each, Virgin Money took home the biggest award with £35m, and previous awardee ClearBank scored an additional £25m for its joint bid with SME banking app Tide.

The BCR said in total it received 78 applications from 64 companies as part of the bidding for Pool E’s second round, which covered the remaining £80m from £100m worth of grants returned by Metro Bank and Nationwide earlier this year.

“We know that the winners and all SMEs in general face challenging times as we head towards winter with both the Covid-19 pandemic and the resulting economic challenges ahead,” said Richard Anderson, chair of the BCR.

“For that reason, it has been exciting to see a very wide range of innovative approaches from so many applicants to supporting all sizes of SMEs in their banking needs. It has been difficult to narrow the awards down to a small number of outstanding winners and BCR looks forward to monitoring progress as they implement their programmes”.

Not everyone will be delighted to hear the news today, AltFi has tracked many applicants who were not successful today including previous awardee Starling Bank, SME credit card provider Cashplus, payments group Contis, fintech Curve and lender Assetz Capital. 

Previous awardee Tide said it will use this new £25m funding along with partner ClearBank to leverage open banking technologies in order to remove friction from bank account switching and to bring third-party lenders onto their platforms.

“We are thankful that the BCR has granted our partnership with ClearBank the opportunity to create a genuine alternative to the oligopoly that has dominated the UK SME market for too long,” said Oliver Prill, CEO of Tide and upcoming speaker at AltFi’s Festival of Finance.

“Competition and choice in the business banking space is more important than ever and this grant will help us to address it urgently.”

MarketFinance said its £10m grant would in-part go towards opening the lending platform up for sole traders and younger SMEs, and that the funding would be matched by the fintech’s own investment in the project.

“We know smaller SMEs and sole traders make up more than 90 per cent of companies in the UK, yet they are at the greatest borrowing disadvantage,” said CEO Anil Stocker.

“Our risk models are much better at understanding and serving these businesses than those of conventional lenders. It is our ambition to get £1bn out to thousands of underserved SMEs in the next few years.”

With the BCR now having completed the roll-out of Pool E, all the awardees will be added to its quarterly monitoring schedule, with the first project updates due in January 2021.