UK-based mobile-only challenger Starling Bank is reportedly seeking to raise up to an additional £35m in funding from the Banking Competition Remedies (BCR), Yahoo Finance UK reported.
The startup bank has already raised £100m so far this year from the fund.
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The bank is applying for one of two grants from BCR, with the grants worth £35m and £25m.
The startup has garnered more than £360m in equity funding since its launch in 2014.
The challenger bank will use the fresh funds over the course of four years to create new products for small and medium-sized businesses (SMBs).
The bank has already used some money for its marketplace development and services like cheque imaging.
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By GlobalDataStarling Bank CEO Anne Boden said: “We are doing well and therefore we believe it’s in the interest of competition in the UK for us to be given an additional grant of £35m in order for us to be competitive in new sectors of SMEs.
“We’ve managed to build a very successful, high-growth SME business, we now have something like 3% of market share and we are a safe pair of hands to be honest.”
The competition funding round, which is worth £775m, has been set up by the Royal Bank of Scotland (RBS) and run by BCR – for encouraging competition among UK banks.
It was initially set up to comply with EU state aid rules after the UK government bailed out RBS during the 2008 financial crisis.
Other fintechs like Tide, Clearbank, Trade Ledger, Equifax, and Funding Xchange are also applying for the grants.
A decision on Starling’s applications for the grant is expected to be taken by September 2020.
