SME challenger bank Allica has reported its first full year of profitability just three years after launching its lending services.
Allica, which provides a range of lending, savings, and investment products to SMEs typically overlooked by larger banks, reported a 141% increase in full-year revenues, reaching £191 million in 2023. The digital-only lending startup became profitable in June 2022, following £1 billion in lending and the migration of 2,000 new customers from AIB. Since then, the bank has doubled its total lending to £2 billion, resulting in a pre-tax profit of £16.1 million for FY23.
Customer deposits surged by 75% over the past year, reaching £2.6 billion, driven by the public launch of its ‘Business Rewards Account,’ which has attracted over 2,000 customers. In 2023, Allica also introduced a new growth finance lending product tailored for businesses seeking flexible financing options, in addition to offering business mortgages and asset finance.
Looking ahead, Allica aims to expand its market presence and achieve over 10% market penetration in the coming years. Richard Davies, CEO of Allica Bank and former executive at HSBC and Revolut, stated, “Recording our first full year profit just three years after opening our doors for lending on the eve of the COVID lockdown was a true milestone in challenging market conditions, and one we’re very proud to have achieved.”