B2B Payments

Cashplus Eyes Startup Credit Ratings In RBS Fund Application

RBS The Royal Bank of Scotland

U.K. challenger bank Cashplus is the latest to apply for a share of the approximately $1 billion fund set aside by RBS to promote competition in the small business banking space.

Reports in The Times on Tuesday (May 28) said Cashplus is seeking about $12.66 million from the fund, which the company said it would use to create a small business credit rating service for young companies. According to Cashplus, developing such a tool would broaden access to capital for startups without a lengthy credit history.

According to the publication, the latest round of grants provided by the RBS funds is the most competitive so far, as it is open to financial services players even if they do not have a banking license. An estimated 100 companies are believed to have applied, with the winners slated to be announced in August.

“If successful, we’ll use these funds to build on our track record of delivering smart, simple products that offer real benefits for customers,” said Cashplus CEO Rich Wagner in a statement, according to separate reports in Finextra. “Having been there ourselves, we understand that small businesses too often face the Catch-22 situation of trying to build a credit footprint while being refused even a modest loan. The big banks just aren’t interested and it’s our mission to step in and support this vital pillar of the U.K. economy.”

In addition to creating its Business Credit solution, Cashplus said the funds would also be used to finance small business loans and to develop new lending products directly integrated into its API solutions to connect financing with SMBs’ payroll, accounting and other back-office financial processes.

“This fund is intended to increase competition and the availability of banking services for SMEs right across the U.K., not just inside the M25,” Wagner added. “Cashplus is the strongest and most credible challenger to the incumbent high street banks, with a sustainable business model that has returned seven years of profits and already serves seven percent of all new U.K. startups.”



The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.