Regulator awards SME lender Cashplus a full UK bank licence

By Oliver Smith on Wednesday 3 February 2021

Digital Banking

The new bank has an ambitious £1bn lending target and plans to reach 10% of new businesses.

Regulator awards SME lender Cashplus a full UK bank licence
Image source: Rich Wagner/Cashplus.

SME credit card lender Cashplus is now a full-on SME bank. 

This morning the Prudential Regulation Authority granted Cashplus an unrestricted banking licence, with approval to start using its £500m in customer deposits for lending.

It’s a move which has huge implications for the SME challenger banking sector, as Cashplus claims to serve 7 per cent of all new UK businesses serving over 1.6m customers since it launched in 2005.

“Where some firms have burned through piles of cash in the pursuit of growth at all costs, our disciplined approach and positive product economics mean that we can grow with confidence,” said CEO and founder Rich Wagner.

“Now we’re a bank, there is a tremendous amount of potential waiting to be unlocked.”

Wagner said the approval would help his bank lend £1bn to SMEs with Cashplus aiming to serve 10 per cent of all new businesses by 2024.

Cashplus’s arrival as a full bank is a further challenge to Starling Bank, Monzo, Revolut and Tide* which have all gained massive traction in the business banking sector—particularly Starling with its over £1.4bn of SME lending.

Unlike its rivals, Cashplus has turned a consecutive operating profit for nine years since 2012 and generated around £50m in revenues last year.

Cashplus has reached this milestone at the moment when UK small businesses need us most,” added Wagner.

“When we started out 15 years ago, we got first-hand experience of the pain that small businesses face when dealing with big banks.”

"These same small companies will be crucial to the UK’s economic recovery and they will need a bank that takes them seriously, providing what they need to be successful. So, while big banks are slamming the door shut, we’ll be welcoming customers, opening up lending and delivering enhanced products to support them through the challenging months ahead.”

*Tide doesn’t hold a UK banking licence.

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