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OakNorth, an all-digital bank in the UK, raised $ 440 million, of which $ 390 million from SoftBanks Vision Fund and $ 50 million from Clermont Group, by CNBC.
global investment in fintech
The banking start-up offers competitive personal and savings accounts, business loans and real estate finance services. It specializes in small and medium-sized enterprise (SME) loans, with loans ranging from 500,000 ($ 648,000) to $ 40 million ($ 52 million) and has a loan portfolio of over $ 2 billion. (2.6 billion USD) to date.
The startup has announced a pre-tax profit of $ 10.6 million ($ 13.7 million) in 2017, making it the first digital bank in the UK to report an annual profit, according to the Financial Times. OakNorth had already completed a $ 78 million ($ 100 million) financing round in September 2018, indicating that investors are keenly interested in the start-up.
The agreement currently represents the largest fundraising event in the field of financial technologies in Europe. This funding brings OakNorth's post-monetary valuation to $ 2.8 billion, making it the region's most valuable fintech. European investments in competing banks have been robust this year, with the OakNorths mega-round coming just one month after the $ 300 million N26 raise, achieving $ 2.7 billion worth of unicorn status, very close from that of OakNorth. None of the European Fintechs has leveraged more than $ 300 million in 2018, indicating that investments made in 2019 have started very well in the region.
OakNorth focuses on mid-sized companies and its ability to expand outside the UK plays a key role in its success. Digital banking attributes its rapid growth in part to its ability to serve an underserved medium-sized market while traditional banks focus on large companies and all lenders such as Funding Circle, which provides loans of a maximum amount. 500,000 (US $ 648,000), mainly targeting smaller entities.
It is important to note that OakNorth has been able to evolve its proposal globally by licensing its OakNorth Analytical Intelligence technology to banks in nine countries other than the United Kingdom (United States). United, Europe and Asia) with approximately $ 5.7 billion in badets.
Partner banks can save time and resources by leveraging OakNorth technology to perform rapid credit badysis, extend customized loans, and proactively monitor their portfolios. This has helped the banking system out of the UK without baduming the credit risk badociated with lending in markets that it does not fully understand or having to invest in acquiring banking licenses in other countries.
We expect the growth of digital banks, both in terms of its UK loan portfolio and cross-border partnerships, will accelerate as it continues to attract funders from the UK. forefront and further develop its OakNorth Analytical Intelligence technology.
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SEE ALSO: The latest trends, technologies and research from the fintech sector in our report on the ecosystem
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