U.K. challenger bank CivilisedBank announced plans to release its banking license to instead focus on developing its underlying infrastructure and technology.
A press release on Friday (April 6) issued by the FinTech, which targets small and medium-sized businesses (SMBs), said it will release the license awarded last May and reapply for another one after further technological development of its solution. The Financial Conduct Authority and Prudential Regulation Authority have been notified of the plans, the firm added.
“The board, with the support of our main shareholder Warwick [Capital Partners], has decided to reapply for a banking license rather than try to rush through our current IT development phase,” explained CivilisedBank Non-Executive Chairman Chris Jolly in a statement. “For us, it is essential that we can deliver an optimal customer offering, so we prefer to delay this stage of our development and have more time to get it right.”
According to CivilisedBank, Warwick is its lead investor. Warwick’s Co-Chief Investment Officer and Founding Partner Ian Burgess said the firm is “fully supportive” of the decision.
“With the latest technology platform, CivilisedBank will stand out as a specialist bank offering a peerless banking service to the SME market designed to enable relationship banking and taking speedy credit decisions,” added Burgess.
CivilisedBank aims to enhance SMBs’ access to financial services through a network of local bankers that can establish relationships with individual small business owners without the need for a visit to the branch. The company said it eventually intends to establish a Local Banker in every major town and city in the U.K.
Late last year, CivilisedBank released new research that found small businesses are increasingly concerned about a lack of direct relationships with their bankers and the closure of branches. Small business owners told CivilisedBank in a survey that they believe financial institutions put profits before customer service.