Fintech startup Tandem given approval to buy Harrods Bank

The Bank of England has given the acquisition a green light

The Bank of England's Prudential Regulatory Authority and the Financial Conduct Authority has given regulatory approval for Tandem to purchase Harrods Bank.

By gaining the full banking licence, Tandem is able to access capital, 10,000 new customers and Harrods Bank's mortgage and savings books.

"We are now within sight of our goal of acquiring Harrods Bank," said Ricky Knox, founder and CEO of Tandem. "This acquisition will transform Tandem into one of the UK's leading digital challenger banks with a fast growing range of products, and a genuine commitment to build a good bank."

"This is a major step forward in our plan to acquire Harrods Bank. When the deal is finally done early in the New Year, it will transform Tandem into one of the UK's leading digital challenger banks," added Knox.

Advertisement - Article continues below

The digital bank was set to acquire Harrods Bank, the banking arm of the London luxury department store, last August (see below) but the deal was waiting for regulatory approval.

Tandem is a four-year-old startup bringing a mobile banking app to help customers manage their money. The sale was reported to be a multi-million pound deal although Tandem has not disclosed the official numbers.

08/08/2017: Fintech startup Tandem is buying Harrods Bank

Advertisement
Advertisement - Article continues below

Digital bank Tandem is set to acquire Harrods Bank, the banking arm of the London luxury department store, subject to regulatory approval.

Tandem is a four-year-old startup building a mobile banking app to help customers manage their money. The sale of the bank was a multi-million pound deal, according to City AM, although Tandem has not revealed the official numbers.

Once the deal is complete, the business will operate under the Tandem brand - bringing an end to the Harrods Bank brand, which opened in 1893.

Advertisement - Article continues below

The deal will give Tandem access to a variety of financial products as well as a banking license. It lost its license in March after failing to secure funding from a Chinese conglomerate.

Talking to City AM, Tandem co-founder Ricky Knox said the deal will take pressure off the startup to make money in the immediate future, but should help it to reach profitability more quickly.

The acquisition will also make it "the most mature digital challenger bank in the nascent market" as it will have an edge over rivals with its near 200 million loans book and over 300 million of deposits according to the publication.

Tandem hopes this will allow them to grow faster and introduce more people to their service. It will now be able to accelerate its launch plans and will start to offer savings accounts soon.

The company is currently developing and rolling out its app and credit card as planned, but Know said his team now has "a little more spring in our step".

Advertisement - Article continues below

The app currently has 18,885 people on its waiting list who are eager to use its features, which include money management tools that help users understand how much money they can spend, spotting the best times in the month to save money and helping them to borrow better to avoid building up debt.

Research from last year showed that bank customers are twice as likely to check their balance via a mobile app than a desktop website. Earlier this year, an international criminal gang launched a DDoS attack against Lloyds causing an outage of its online banking and smartphone app.

Image source: Tandem

Featured Resources

Top 5 challenges of migrating applications to the cloud

Explore how VMware Cloud on AWS helps to address common cloud migration challenges

Download now

3 reasons why now is the time to rethink your network

Changing requirements call for new solutions

Download now

All-flash buyer’s guide

Tips for evaluating Solid-State Arrays

Download now

Enabling enterprise machine and deep learning with intelligent storage

The power of AI can only be realised through efficient and performant delivery of data

Download now
Advertisement
Advertisement

Most Popular

Visit/security/privacy/355155/zoom-kills-facebook-integration-after-data-transfer-backlash
privacy

Zoom kills Facebook integration after data transfer backlash

30 Mar 2020
Visit/infrastructure/server-storage/355118/hpe-warns-of-critical-bug-that-destroys-ssds-after-40000-hours
Server & storage

HPE warns of 'critical' bug that destroys SSDs after 40,000 hours

26 Mar 2020
Visit/security/data-breaches/355173/marriott-hit-by-data-breach-exposing-personal-data-of-52-million
data breaches

Marriott data breach exposes personal data of 5.2 million guests

31 Mar 2020
Visit/security/cyber-crime/355171/fbi-warns-of-zoom-bombing-hackers-amidst-coronavirus-usage-spike
cyber crime

FBI warns of ‘Zoom-bombing’ hackers amid coronavirus usage spike

31 Mar 2020