Lloyds Bank has invested £5 million for a 20% stake in invoice financing startup Satago and will roll out the platform for its Single Invoice Finance and whole of book Invoice Factoring customers.
The deal with Satago follows a competitive tender process and a six month trial of the technology. Once deployed it will introduce a new digitised proposition for lending to the bank's SME customers.
Satago expects to be paid a recurring fee for each customer of the bank which utilises the platform, as well as one-off implementation fees, with the final terms of the agreement subject to commercial negotiation.
As part of the arrangement, Ben Stephenson, MD and head of specialist client solutions at Lloyds Bank will join Satago's board.
"Extending our partnership with a leading Fintech like Satago represents a truly exciting opportunity for LBG and our clients," he says. "Combining Satago's technology with LBG's reach has created a market leading proposition that provides clients with much needed working capital management and cash flow optimisation tools."
The £5 million equity investment values Satago at £20 million.
Gwynne Master, managing director, Working Capital, Lloyds Bank, comments: "Our partnership with Satago goes beyond that of a supplier and buyer relationship. The equity stake we have taken in the business underscores our commitment to deliver best-in-class, future-focused solutions for our UK clients by partnering with a market leading provider with proven capability."