By Tandem Money Ltd [CC BY-SA 4.0] via Wikimedia Commons
Bob Diamond, the former Barclays boss, will not be making a comeback to British retail banking, having ruled out holding a stake in Tandem, a digital challenger bank.
The Atlas Merchant Capital of Diamond had been one of the several potential investors in discussions with the fintech company during the recent months. However, it is not part of the latest funding round that includes some new and existing investors.
The sum of fresh cash has not been disclosed. However, announcing the closure of a deal to acquire Harrods Bank today, Tandem said that it has access to capital amounting to £80m.
Ricky Knox, the chief executive of the bank, informed reporters that it comes largely from its existing investors and that it would last for “a couple of years” taking the company through to profitability – something that he expects to occur within the next five years.
“From a practical perspective, it will allow us to get to profitability faster. One of the challenges is capital, and it can be hard to return to investors. This is a massive accelerator to get us further down the curve,” said Knox.
“This will last us through to profitability, but that’s not to say we won’t go for more,” added Knox.
Completing the deal following the approval from regulators means that Tandem is able to regain its banking licence. It lost it in 2017 after Sanpowe, the House of Fraser owner, pulled its funding from the bank.
“This puts us miles ahead of Monzo and Starling,” Knox said. “We’ll be quite possibly the largest challenger bank by assets and the biggest by revenue.”
He said that his personal goal is to push revenue into the double-digit millions in 2018.