App-only Atom Bank has succeeded in raising more money as part of a £250m funding round, as it races to secure market share in the newest front in the battle for banking customers.
The fintech start-up will receive £113m in investments from Spanish bank BBVA, as well as investment funds Toscafund and Woodford Investment Management, according to Sky News.
Read more: Will.i.am says yes we can to Atom Bank
Atom is set to announce the deal at a shareholder meeting on Friday.
Woodford and Toscafund declined to comment. BBVA and Atom Bank did not respond to requests for comment.
The bank is contending with various rivals in the app-based space, such as Monzo and Tandem Bank.
Meanwhile traditional banks have also been forced to make significant investments in their own app offerings as they attempt to defend their market share.
Mark Mullen, the chief executive of Atom Bank, has in the past noted his approval of regulators’ efforts to help challengers disrupting the old model of banking, which relied on an extensive but costly network of branches.
In the same speech Mullen noted raising capital was the biggest barrier to entry for firms, with some new banks using crowdfunding as a way to both tempt customers and raise large amounts of cash.
Atom Bank has sought to stand out by striking a deal with musician-cum-technology investor Will.i.am, which gives him the option to buy a stake in the company worth millions, in return for help marketing the bank as well as taking a seat on the board.