Coconut Joins Race For RBS Funds

After the first round of winners was announced in the competition for shares of Royal Bank of Scotland funds, more players are joining the race.

U.K. challenger bank Coconut announced Monday (April 1) it is throwing its hat in the ring to receive RBS funds of up to $32.9 million, it said in a press release. The funds would be a part of Pool D of the Competition Remedies Fund, which the government established as a result of bailing out RBS following the financial crisis. The funds aim to inject competition into the U.K. banking sector.

“We are finally seeing funds being poured back into innovative tech that can help self-employed people and small business owners with their finances,” said Coconut CEO and Co-Founder Sam O’Connor in a statement. “People have been left out in the cold for too long, underserved by banks that use antiquated legacy systems or cloud accounting packages that require a level of expertise people simply don’t have.”

“If we are selected,” he added, “the prize will help us develop richer features to help manage business finances and reach hundreds of thousands of customers in the U.K.”

The RBS fund has been a controversial initiative, with the government naming Metro Bank, Starling Bank and Clear Bank as the first winners to receive portions of the $1 billion up for grabs.

In addition to vying for some of the RBS money, Coconut also announced plans to roll out integrated accounting services for its small business and sole trader customers. The solution, which will launch sometime this month, complies with tax regulators’ mandate to adopt digital-only VAT submissions.

Coconut said the service will offer businesses an app that supports enhanced visibility of expenses and seamless movement of money, as well as integrated guidance on money management and access to a network of accountants to provide in-app chat advisory services to file taxes. The company said the combination of tax advice and currency account services “will be more efficient and helpful to small traders than the current raft of tools on offer from banks and cloud accounting suppliers.”