Allica Bank Secures Unicorn Status with Major Funding Round
Allica Bank, a prominent small business lender, has officially joined the prestigious ranks of British fintech unicorns after securing a substantial new funding round. The challenger bank has successfully raised $155 million, equivalent to approximately £111 million, in a Series D fundraising effort. This significant capital injection has propelled the firm's valuation to an impressive $1.2 billion, firmly establishing it as a unicorn in the competitive financial technology landscape.
Investment from Global Players
The funding round attracted notable investment from Dubai-based Ventura Capital, a venture firm with stakes in industry giants such as Uber and Spotify, as well as UK fintech favorite Zilch. This international backing underscores Allica Bank's growing influence and potential in the global fintech sector. Richard Davies, the former Revolut and HSBC executive who currently leads Allica, had previously expressed confidence in the bank's trajectory toward unicorn status. His remarks followed a period of remarkable financial performance, including an 86 percent increase in pre-tax profit to £29.9 million and lending activity surpassing the £1 billion mark.
Transforming the Small Business Lending Market
Davies highlighted the transformative role Allica has played in what he described as a barren wasteland for small business lending five to ten years ago. The bank's strategic focus on this underserved market has been a key driver of its rapid growth and success. Digital lenders like Allica, which was honored as City AM's Bank of the Year in 2025, have effectively filled the void left by traditional large banks that have retreated from the sector. Today, challenger banks account for 60 percent of the market, a dramatic shift from 2019 when the four largest banks dominated 90 percent of lending activities.
Expansion and Acquisitions
The latest funding round, initially reported by Sky News, positions Allica alongside other leading UK challenger banks such as Monzo, Revolut, and Starling. This Series D round represents a slight increase from the £100 million Series C funding secured in December 2022. In a strategic move to bolster its capabilities, Allica acquired London-based fintech Kriya in October, a firm specializing in embedded finance and business loans. Kriya reported revenues of £12.6 million in 2024, down from £16.9 million the previous year, with pre-tax losses decreasing to £9 million from £11.5 million in 2023.
Strategic Growth and Future Goals
This acquisition marks Allica's third major integration, following the absorption of Allied Irish Bank's SME portfolio and the purchase of bridging finance specialist Tuscan Capital in 2024. These strategic moves align with Allica's ambitious target of achieving £1 billion in working capital finance over the next three years. Working capital finance encompasses short-term, quick-access funding solutions such as loans and credit lines, essential for supporting small business operations and growth. Allica's journey to unicorn status reflects its commitment to innovation and excellence in the fintech industry, setting a new benchmark for challenger banks in the UK and beyond.
