You are here: Home - Saving & Banking - News - Understanding -

Tandem buys Harrods Bank: what this means for customers

0
Written by: Paloma Kubiak
07/08/2017
Digital challenger Tandem has struck a deal to buy loss-making Harrods Bank. Here’s what the move means for existing customers of the luxury brand.

Crowd-funded, digital banking firm Tandem has announced it has signed an agreement to acquire 100% of Harrods Bank.

The transaction is subject to regulatory approval and while the financial terms haven’t been disclosed, Tandem confirms it will benefit from £80m of capital coming into the business.

The start-up expects to receive regulatory approval by the end of the year and the move should also see Tandem fast-tracked down the process to offer deposit accounts, again expected in Q4 2017.

This is because it is buying a bank which already has a full banking licence. So given a nod from the regulator, Tandem will be able to move from an app tracking spending, credits and financial services switching, to one offering a range of banking services.

Harrods Bank was put up for sale in April and has made more than £13m of losses over the last two financial years while lending around £200m in 2015 and 2016.

It lost £4.9m in 2015 and £8.4m in 2016, with analysts suggesting much of its value was attached to its prestigious name.

Ricky Knox, Tandem founder, said: “Tandem has been built from the ground-up with the help of over 11,000 co-founders, who have helped us shape products and services that really make a difference to their lives. This acquisition will allow us to scale the business and ensure we can introduce as many people as possible to a new way of banking.”

What does the sale mean for existing Harrods Bank customers?

Tandem Bank was unable to confirm how many Harrods Bank customers were affected by the sale. However, Harrods currently offers savings products, residential and buy-to-let mortgages, international money transfers and a bullion service.

When asked what this will mean for existing customers, whether they need to do anything and whether existing terms of products would remain the same, it told YourMoney.com: “The full range of services to be offered is currently subject to review. Existing customers will be first to know should there be any changes. Should there be any changes, Tandem will work closely with customers to ensure a smooth transition.”

Once the deal is approved and finalised, both businesses will operate under the Tandem brand. Since Harrods Bank already has a full banking license, customers will be afforded the same protections as they currently receive under the Financial Services Compensation Scheme, Prudential Regulation Authority and Financial Conduct Authority.

Tandem’s app is available in the app store. It added that its credit cards are currently being tested by the co-founders and it aims to launch these more widely in the coming months.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

YourMoney.com Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
CarHireAirport
How to challenge unfair car hire charges

Holidaymakers may be more used to surprises at the car hire rental desk, but you could be left reeling from...

Close