The mobile-only bank will use the funding to drive its growth as a lender and fund further investment in its technology and business capabilities.

As part of the round, BBVA will invest a further £85.4m in the bank to increase its ownership to around 39%, subject to regulatory and shareholder approval.

Toscafund will invest £54.4m and also increase its stake in the bank.

A number of the bank's other existing shareholders are also supporting the raise.

Mark Mullen, CEO at Atom bank (pictured above), said: “We are very proud of what we have achieved in the Atom journey to date and we are excited about our plans for the future.

“This further significant injection of capital secures the bank's place as a disruptive force in the mainstream of UK banking.

“We will continue to invest in growth, in our technology and in our products as we continue to push ahead with the support of our investors."

So far, Atom has secured £1.3bn of deposits and loaned over £1.2bn to SMEs and homeowners in the UK.

Bridget Rosewell, chair at Atom bank, added: “Atom is a rapidly growing, ambitious and vibrant business that is founded on the unique fit of our shareholders, our team and our partners.

“I am delighted that our investors have decided to back the bank with such a significant injection of capital to fuel our mission to change banking permanently for the better.”