Challenger bank seeks to fill small business banking gap
A new challenger bank targeted at smaller businesses in the counties of Hertfordshire, Bedfordshire and Buckinghamshire has submitted an application for a banking licence.
The challenger bank called Redwood Bank? is expected to launch in early 2017 and begin financing regional customers later in the year.
Alongside its lending service, Redwood Bank financed by private equity firm Acorn Financial Partners will enable its customers access to business development managers and digital distribution channels.
Reports have suggested that shareholders will invest 50m into the bank over the next five years.
In a statement, the potential future chairman of Redwood Bank Jonathan Rowland acknowledged the failure of major banks to return to pre-crisis business lending levels? and said that therefore this is an ideal time to apply for a full banking licence.
Rowland also highlighted the demand from small business owners for a dedicated alternative to banking heavyweights: ‘sMEs have shown a strong appetite for new market entrants offering competitive rates and superior customer service.
Gary Wilkinson, proposed chief executive of the challenger bank, commented on the strong potential of the bank in engaging with the needs of small business owners in Britain.
I am certain that Redwood’s relationship-driven, agile and traditional approach, combined with straightforward and transparent products, will resonate among ambitious business owners seeking to grow over the coming years, he said in a statement.
The challenger bank sector has witnessed an increase in popularity among entrepreneurs in recent years, combining competitive financing opportunities with levels of personalised service and product diversity not always found in the commercial offerings of major banks.
Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.
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