CYBG to lend £400m via Salary Finance
CYBG will fund Salary Finance’s salary-deducted loans product line. The bank has agreed to lend that large sum, “subject to certain conditions”.
David Duffy, chief executive of CYBG, says: “Fintech is revolutionising how the financial sector works – 42% of us in the UK now use the services of at least one fintech firm. We have been hugely impressed by the Salary Finance team and the clear social purpose that underpins everything they do.”
Asesh Sarkar, chief executive of Salary Finance, adds: “Our flagship salary deducted loans product is a core part of our broader financial wellbeing platform and the funding joint venture with CYBG will enable us to continue to scale the product over the coming years.”
Salary Finance’s platform connects to the payroll of participating employers to offer salary-deducted savings, loans and pay advances, as well as financial education.
The duo come out with quite a common view in fintech… namely “employee financial wellbeing is fast becoming a priority for employers, with a growing body of evidence showing the impact financial stress can have on employee productivity, retention and mental health”.
Salary Finance has an existing banking relationship with CYBG as an SME customer with a revolving credit facility funding line.
CYBG says it has “significantly” invested in its digital platform, iB, as part of a £350 million investment programme for open API capabilities.
According to Salary Finance, it reaches over a million employees across various sectors. Customers include BT, E.ON, Virgin Active, Capgemini, Carlsberg, Dixons Carphone, L&G and NHS Trusts, councils and schools.
In other recent related news, CYBG, the new owner of Virgin Money, unsurprisingly cancelled a long-term deal with former Barclays CEO Antony Jenkins’ digital banking start-up.
In addition, Debbie Crosbie, currently CYBG’s group chief operating officer and executive director, will become the new CEO for TSB. The latter needs to turn its fortunes around and had to bring in fresh blood.