Lloyds Bank is partnering Satago, an invoice financing startup for UK SMEs, in a deal that will see the bank invest £5m into the FinTech in exchange for a 20 per cent equity stake.

Satago, founded in 2021, enables UK SMEs to access short-term finance against pending invoices, thereby opening up the capital and assets needed to drive business growth.

The FinTech also provides automated credit control and risk management to SMEs and accountants.

The agreement builds on Lloyds Bank’s existing partnership with Satago and extends the use of its technology to help Lloyds Bank customers get access to cash against invoices due.

Satago said the integration will power a single unified solution for customers of all sizes and facility requirements that improve the client’s user experience while minimising risk exposure and cost to serve.

Commenting on the strategic investment, Gwynne Master, managing director, working capital at Lloyds Bank commercial banking, said: “Our partnership with Satago goes beyond a supplier-buyer relationship. The equity stake we have taken in the business underscores our commitment to deliver best-in-class, future-focused solutions for UK businesses by partnering with a market leading provider with proven capability.”

“Our new platform enhances both the choices and the speed at which finance solutions will be offered to small and medium sized businesses. We are leveraging the advanced technology of Satago’s platform to digitally match businesses’ needs and solutions for either Single- or Whole-Book Invoice Factoring to produce tailored customer-centric outcomes, quickly.

Satago said that Lloyds Bank Commercial Banking customers will benefit from real-time insights into which companies pay their invoices on time, and a suite of tools including automated invoices, reminders, payment requests and integrated credit reporting to help them track their finances and outstanding payments.

The final terms of the commercial agreement are subject to negotiation, according to a statement.

Sinead McHale, chief executive officer of Satago, said: “We are extremely excited to partner with Lloyds Banking Group to bring invoice financing into the 21st century. It’s a market that has changed very little in decades, so we’re delighted that Lloyds shares our vision to make it available to all UK businesses regardless of size or sector.”

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