Tide set to invest £60 million to become the number one business banking challenger in the UK

Tide, the SME-only leader in digital challenger banking, today sets out its plans to co-invest at least £60 million in the UK over the next five years. Working with its partner ClearBank, the next-generation clearing bank, Tide aims to substantially increase its share of the UK business banking market. Tide’s aim is to become the number one challenger in the industry.

To achieve its goal of creating a genuine competitor to the high street banks that dominate the UK business banking sector, Tide is set to raise an additional £60 million. This funding will match the £60 million grant awarded to ClearBank by Banking Competition Remedies Ltd as part of the RBS Alternative Remedies Package.

The total £120 million investment will allow Tide, with its market-leading digital banking platform, combined with ClearBank’s world-class payments infrastructure to target a market share of at least 8% by 2023.

To secure the additional £60 million funding, Tide is planning Series B and C investment rounds in the next two years. In addition to its strong existing shareholder base, Tide has received expressions of investment interest from around 70 VC firms across the globe.

The funding will be focused on: driving awareness of the Tide brand; overcoming switching friction; and creating compelling reasons for customers not to default to the oligopoly that has served SMEs so poorly. Tide will also launch new products and services for its customers. These will include payroll tools, expense cards and multi-business banking, to make its offer even more compelling.

The new investment commitment in the UK will build on Tide’s rapid growth in the two years since it started operation. Tide is growing faster than any other UK business banking player and is the clear leader in digital challenger banking for SMEs. Tide now has around nearly 70,000 members. This equates to a 1.2% share of the market which totals 5.7 million UK SMEs, according to the Department of Business Innovation and Skills.

Oliver Prill, CEO of Tide, said: “This new investment plan will help Tide accelerate its strategy to capture a significant share of the SME banking market. It will allow us to reach our goal of becoming the leading business banking challenger in the UK.

“We want to create a genuine scale challenger to the oligopoly that has dominated and failed SMEs for too long. SMEs should have the option of a dedicated and focused banking partner that will help them grow their business. With a clear plan for growth in the UK backed by significant investment, and our platform established and proven, we are ready for an exciting future.”

Tide offers its growing army of members business banking without monthly, weekly or annual, or card usage fees. The only costs are for transfers from non-Tide accounts, ATM use and cash deposits at the post office. Unlike traditional banks, a new Tide account can be up and running in just five minutes rather than what can be weeks on the high street. As well as balances and payments, Tide can be fully integrated into accounting systems. Tide was among the first to launch with Xero’s new bank feed integration.