A challenger bank with half a million customers is poised to announce a “large” funding round that will fuel international expansion, Yahoo Finance UK can reveal.
Tandem Bank confirmed in a statement that it is set to announce the fresh funding in the coming weeks.
“Tandem Bank is poised to announce a large investment which will bolster their efforts for international expansion in Q4 this year,” a spokesperson said.
“Tandem, launched in January 2018, has already seen significant investments since its inception. This latest funding round will drive further product development including the UK’s first crowd-designed mortgage and the launch of their first current account in 2020. In addition, Tandem’s overseas expansion is currently planned for late 2019.”
The Telegraph reported in April that Tandem had begun fundraising talks but the startup has made no announcement since then. At the time, it was reported that Tandem was seeking over £100m, adding to the tens of millions already raised. The exact size of the final round is unclear.
Tandem was founded in 2015 and is one of a wave of app-only “neobanks” founded around the same time in the UK. Others included Monzo, Starling, Atom, and Revolut.
Tandem offers credit cards and unsecured loans. Founder Ricky Knox told Yahoo Finance UK earlier this year that Tandem had signed up 500,000 customers was hoping to double headcount to support its expansion.
News of the fresh capital injection comes as accounts show Tandem lost £26.7m last year. That was up from a £23.6m loss in 2017. Operating expenses were £31m in 2018 and Tandem had net assets of £68.2m at the end of December 2018.
Tandem lost its banking license in 2017 after a funding deal fell through and it was forced into a Hail Mary deal to takeover loss-making Harrods Bank to save the business. The deal saw Harrods’ Qatari owners inject £80m into Tandem and Qatar still owns around 60% of the startup.
PwC warned in Tandem’s recent accounts that the company “requires further capital injections” before April 2020 to support growth plans. Knox wrote in the accounts, which were signed off in April, that Tandem had a “reasonable expectation” of raising new cash due to discussions with new and existing investors.
Oscar Williams-Grut is Yahoo Finance UK’s City correspondent. He covers banking, fintech, and finance for Yahoo Finance UK. Follow him on Twitter at @OscarWGrut.