City of London Group (CoLG) has raised £8.7m in new capital for its subsidiary Recognise Bank, which is focused on SMEs in the UK.
The proceeds come from CoLG’s existing backers, PV27, the family office of real estate entrepreneur Ruth Parasol, and Max Barney Investment, who exercised their warrants received in August 2021.
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Recognise Bank will use the proceeds to offer credit to small businesses and create a new team to accelerate its digital innovation, which includes updating its product portfolio and creating new revenue streams.
The lender has already made several appointments to the team and plans to announce the first development projects soon.
In September 2021, Recognise Bank secured full authorisation from the Prudential Regulation Authority (PRA).
The development followed its £14m funding round in August of that year.
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By GlobalDataRecognise Bank offers a range of unregulated lending options to clients via a network of relationship managers across the UK.
Recently, the lender achieved £100m in lending and its personal savings accounts have attracted £95m deposits.
Bryce Glover, CEO of Recognise Bank, said: “Recognise Bank has already made its mark in the business banking sector by hitting the challenging lending target we set, proving there is a demand amongst the UK’s SMEs for our mix of relationship banking, supported by cutting edge technology.
“To receive this fresh investment from two of our keystone shareholders shows their continued support for Recognise Bank and commitment to our strategy and vision. Investing in our digital capabilities will help us build a world-class business bank, for today and the future.”
In November 2021, Recognise Bank selected banking-as-a-service provider ClearBank to strengthen its SME and retail banking capabilities.
