We launched in September 2015 with a very simple proposition: we raise deposits from both businesses and individuals and use that to help fund our lending (typically between £500,000 to £20m) to fast-growth businesses and established property developers.
On the deposits side of the business, the process is fully automated, enabling savers to open an account within minutes, and the entire function is run by just three team members. The fact that we’re branchless enables us to keep costs low and pass on these savings to our depositors in the form of more competitive rates.
In May 2016, we became fully hosted in the cloud – we wanted to make this transition for several reasons:
- It enables us to be more flexible and change settings as we go along. As a new bank, we wanted the freedom to experiment and continuously evolve our offering in line with customer needs and expectations.
- It means we can make changes to our systems much more quickly than most banks — often in days rather than weeks.
- The cloud can handle rapidly increasing workloads — it doesn’t matter if we on-board 20 or 20,000 customers, the AWS cloud eliminates the need to try to approximate our infrastructure capacity needs.
- It is now possible to be more secure in the cloud than on-premises. AWS invests a huge amount in security, meaning we can build more secure applications for our customers.
- It enables us to focus on the business side and the functionality of what we want to achieve, as opposed to getting distracted by IT issues – we’ve managed to grow our loan book to over £750m in just two years, helping more than 150 businesses achieve their growth ambitions.
- It dramatically reduces our expenditure, which is what helped us reach cash flow break-even in just 11 months.
On the lending side of the business, we also rely heavily on technology – by leveraging a combination of fundamental credit analysis, data analytics, AI and machine learning, we are able to underwrite loans against multiple asset types: real estate, stock, debtors, plant and machinery, and intellectual property and do this at scale. On average, it takes just three weeks – from first meeting to disbursement of cash – to complete a transaction. This is with the same level of rigorous and robust underwriting as can be found at private equity firms, and is evidenced by the fact that we’ve had over £150m of repayments since launch and never so much as a late payment, let alone a default.
However, while technology plays a central role in our business, we still think face-to-face interaction and personal relationships are extremely important if you want to deliver a great customer experience. Unlike incumbent banks, we give our borrowers the chance to come in and meet our credit committee and discuss their lending needs directly with the decision makers. We don’t have reams of tick-box forms, and we don’t have set credit committee days, so we can sit whenever our customers need us and are nimble enough to make things happen as quickly as necessary.
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
AIB provides funding for acquisition of 190 homes
AIB Corporate Banking has formed a partnership with Túath Housing Association to fund the acquisition of up to 190 social homes across every county and district in Ireland.
Virgin Money set to enter SME banking market
Virgin Money Holdings UK has announced plans to enter the UK SME banking market in January 2018.
British Business Bank welcomes extra £2.5bn government funding
The British Business Bank has welcomed the extra £2.5bn of government funding, announced in the Autumn Budget.
£11m UTB facility saves developer from considerable funding costs
United Trust Bank’s (UTB) structured finance team has provided an £11m facility to save a property development company from paying considerable funding costs.
Behind the scenes at Metro Bank’s new London store opening
Metro Bank opened its 52nd store in Liverpool Street, London, last Thursday (16th November), with the lord mayor of the City of London Alderman Charles Bowman cutting the ribbon.
Do people underestimate the scale of UK SMEs?
Only 2% of British people realise that SMEs make up 99% of total UK businesses, new research has revealed.
We need to aim higher than ‘a nation of shopkeepers’
I read an interesting newspaper article the other day with the headline: “UK bank scandals are making entrepreneurs reluctant borrowers”.
What are the key changes from the Autumn Budget 2017?
In the first Autumn Budget, the chancellor of the exchequer Philip Hammond has set out the government’s plan for the UK economy.
CYBG reports 6% lending growth
CYBG PLC has reported total lending growth of 6% during the year ending 30th September 2017.
Do enough businesses realise the benefits of asset finance?
Only one in 10 business owners (11%) describe the strength of their companies’ working capital facilities as “very strong”, even though their businesses are performing well, a report has revealed.