SME-focused Allica Bank is launching a £100m funding round after experiencing high demand from British businesses in the aftermath of the pandemic.
The bank, which received full UK banking authorisation in late 2019, said it has had over £1bn of loan enquiries from businesses in recent months.
Allica Bank said the new funding round will allow it to accelerate lending to British businesses and also position it for any M&A opportunities that materialise in the non-bank lending market.
The fund comes in the wake of a recent survey conducted by Allica Bank, which showed that 63% of commercial finance brokers had seen a significant reduction to the supply of business lending following the pandemic.
It also said that 98% of commercial finance brokers are concerned about business lenders’ credit and liquidity over the next two years.
The bank has also recently completed a follow-on investment of £26m led by existing majority shareholder, Warwick Capital Partners.
Richard Davis, CEO of Allica Bank, said: “Established small and medium sized enterprises (SMEs) will be vital to the recovery and health of the UK economy, but it is clear that the supply of finance has been very badly damaged by Covid-19 outside of the government schemes.
“The time is now for Allica to scale up its operations to meet this business funding gap, bringing a blend of human relationships, deep lending expertise, and digital disruption.”
He added: “Together with potential acquisition opportunities of non bank lenders impacted by the pandemic, we intend to create the leading SME challenger bank for the decade ahead.”