Bank to the Future emerges as challenger hopeful

Simon Dixon, co-founder of the finance-raising website, confirmed that it was in the early stages of talks with the PRA, which announced last year that it had relaxed its criteria for start-up banks wishing to enter the market.

Mr Dixon said: “We saw an opportunity when the PRA reduced its barriers for entry and although banks such as Metro are rare cases of traditional clearing banks pushing through the barriers and challenging the top four meaningfully, we believe we can offer a compelling alternative.”

Mr Dixon also said he was helping four other contenders raise finance to meet the new capital reserve requirements set out by the PRA, which he estimated had reduced from £35m to between £2 and £5m.

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He said: “The process is proving lengthy, even when banks have sufficiently prepared teams and a solid business model. But it is clear that there are many interesting and new models coming through, some of them with fairly niche localised elements and others with a strong online presence.”

Other banks that have put themselves forward for consideration include the Scottish private-banking enterprise Scoban and ventures based in the northeast and Northumberland.

Speculation has also mounted that a regional bank masterminded by Anthony Thomson, co-founder of Metro Bank, is at an advanced stage of regulatory approval. When asked to comment, Mr Thomson declined to comment. He added: “I may or may not attach myself to further banking projects. To comment at this stage would be premature.”

Adviser view

Robin Keyte, director of Somerset-based Keyte Chartered Financial Planners, said: “Other countries have developed community-based banks that have served the role of old fashioned building societies. There are also examples of successful community development finance institutes around the world but we do not have anything like that. What is missing is a community-based banking approach, a return to localism.”

Crowd funding

To its supporters, online crowd funding offers an alternative way for businesses to raise finance and investors to invest in private companies .