UK-based digital challenger bank Tandem has lost its banking license after a Chinese conglomerate abandoned plans to infuse funding into the lender.
The bank was expecting a funding of £29m from House of Fraser, a Chinese-owned UK department-store chain.
House of Fraser cancelled its investment plans due to concerns over capital controls imposed by Chinese regulators.
In 2016, Tandem had secured deposit-taking license from the Prudential Regulation Authority.
Tandem chief executive officer Ricky Knox was quoted by Bloomberg as saying: “While this investment not completing is disappointing, it does not change our vision.
“We will no longer be launching savings accounts in the short term. Our app will still help our customers manage their money better and actually find them cash, and our fair credit card will launch in a few months.”
In December, the bank received a funding of £6m from House of Fraser. However, its plans to raise additional funds have taken hit due to restrictions on outbound foreign investments in China.
The bank said that the plans to launch a new generation of financial services products to the retailer’s multi-million customer base remains a priority for both House of Fraser and Tandem.
Tandem said: “This will not delay our launch to the market, with the app – which will allow customers to view all their money in one place and optimise their finances – still launching to the public in the coming months followed by credit cards later this year, subject to regulatory approval.”
Image: The bank was expecting a funding of £29m from House of Fraser. Photo: courtesy of blackzheep/FreeDigitalPhotos.net.