Fresh from a £17.7 million funding round, UK social banking startup Kroo has received a restricted banking licence from the Prudential Regulation Authority and the Financial Conduct Authority.
The authorisation with restriction means that Kroo can accept deposits up to £50,000 in total. This ‘mobilisation’ phase allows new banks a time to finalise their systems, infrastructure and controls ahead of public launch, which for Kroo is expected in early 2022, once the full banking licence is granted.
Kroo's current product range - a prepaid debit card and app - enables customers to easily create groups with friends, track spending, and split and pay bills quickly and securely.
Once the restrictions are lifted in early 2022, Kroo intends to gradually close down the prepaid card scheme and offer its 5000 users the ability to transition their existing accounts over to the new Kroo current account.
As part of its product expansion, the bank - which has raised a total of £30m in venture capital funding since launch - will offer loans later in 2022 and grow its workforce across technology, marketing, risk, compliance and customer support.
Andrea De Gottardo, CEO of Kroo, says “It is incredibly exciting to finally be a bank that is authorised with restrictions. Very few firms in the UK get to this point and this represents a huge milestone for the entire team."