A UK department store is making a multi-million pound investment in an app-only challenger bank in order to offer its shoppers an exclusive banking tool and payment method.
House of Fraser has spent £35m with challenger bank Tandem to develop an app-only banking service to customers.
The department store, which was acquired by Chinese conglomerate Sanpower for £480m in 2014, already has a loyalty and credit card scheme with NewDay but the link-up with Tandem could be a new trend for high street retailers.
Tandem, which received its banking license in 2016, is one of a number of digital-only, neobanks challenging the high street institutions in the UK. It raised more than £30m in funding in 2016, including an investment from eBay co-founder Pierre Omidvar.
Tandem has so far rolled out its mobile app to more than 10,000 customers and plans to launch current accounts and credit cards later in 2017.