UK-based digital banking app for students Loot has entered administration after a potential deal to secure funding collapsed.
The fintech entered administration in less than six months after it secured an investment from Royal Bank of Scotland (RBS).
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Loot enters administration: Details
RBS, which already owns 25% stake in Loot, abandoned a potential deal to acquire the full company. Loot explored alternative investment sources, but failed to finalise a deal, reported The Financial Times.
However, one of the joint administrators of the Loot told the publication that it is in advanced discussions with a potential buyer. A deal may be finalised in the coming weeks, he added.
Loot has been providing current account and pre-paid debit card services to the students and millennial customers since its inception in 2014.
The startup, which has around 175,000 customers, also offers customised insights on spending habits to its customers.
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By GlobalDataThe fintech don’t have a full banking licence but it operates under an electronic money licence in partnership with Financial Conduct Authority regulated Wirecard.
RBS acquired 25% stake in the company through two rounds of investments, one in last year and another in January. Overall, it invested £5m in the company.
The investment was made through its upcoming digital bank Bó. RBS plans to launch the digital lender later this year.
