Digital bank targets Swedish expansion

A UK digital business bank is setting its sights on Europe after applying for a Swedish banking licence as part of its international expansion plans.

Allica Bank has submitted an application to Finansinspektionen, the Swedish Financial Supervisory Authority, as it prepares for its first move outside the UK.

The bank has already established a Swedish legal entity and appointed an executive team, led by Rickard Westlund, alongside chief technology officer Javier Ubillos, chief product and operating officer Victor Ramstrom and chief financial officer Samuel Tawadros.

Further recruitment across product, technology and operational roles is underway.

Richard Davies, chief executive of Allica Bank, said: “Sweden has one of Europe’s most digital economies, with a well-respected regulator, making it a natural choice for Allica’s first expansion outside the UK. 

“Its established businesses face many of the same challenges we have seen in the UK, where firms that make a major contribution to the economy have too often been underserved by traditional banks.”

 The move follows Allica’s $155 million Series D funding round in February, which valued the bank at close to $1.2 billion and is supporting its next phase of growth and international expansion.

If authorised, the Swedish banking licence could also provide a platform for Allica to expand into other European Union markets over the longer term.

Allica says it selected Sweden because of its established business lending market, highly digital economy and concentration of market share among incumbent banks.

Founded to support established businesses employing between five and 250 people, Allica secured its UK banking licence in 2019.

It has since lent more than £4 billion to established UK businesses, with more than 15,000 using its current account.

The Swedish expansion would see Allica look to apply the approach it has developed in Britain to businesses facing similar banking challenges in its first international market.

Richard added: “We would not be taking this step without the proven model we have built in the UK. 

“Allica has grown by delivering on its promises to established businesses, with a full stack product offering and combining market-leading technology with the expertise and service these businesses need. 

“We are excited by the opportunity to bring our model to Sweden, subject to regulatory approval.”

Lucy Rigby, economic secretary to the Treasury, added: “It’s brilliant to see Allica building on their success here in the UK and expanding into other European markets. 

“The UK is a fintech powerhouse, and I’m fully committed to ensuring it remains a jurisdiction where the world's most innovative financial services firms choose to start, scale and stay.”

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