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Fintech turns on capital taps with $200m funding for US expansion

Capital on Tap

London-based fintech Capital on Tap has secured a $200m (£153.6m) investment from HSBC and Värde Partners to continue expanding its SME funding service in the US.

Founded in 2012, Capital on Tap provides business credit cards that come with spending controls, reporting and rewards.

The alternative lender initially focused on the UK market but launched a US business credit card in March 2021.

Across both markets, it has provided more than £3.5bn in funding to over 125,000 SMEs. It provides a credit facility of up to £150,000 and doesn’t charge for ATM use in the UK.

Capital on Tap’s market includes businesses with a turnover of at least £2,000 per month.

As part of its move into the US market, Capital on Tap established an office in Atlanta, adding to its presence in London and Cardiff.

The fintech company has 50 people at its Atlanta office and will use the fresh investment to increase hiring.

Alan Hart, CFO, Capital on Tap, said: “With the closing of this facility we are looking forward to expanding our ability to provide essential funding for small businesses across the United States. We are thrilled to be joined in this mission with Värde Partners as well as extending our already international relationship with HSBC.”

The latest investment follows a £450m funding facility closed in November last year, which also saw HSBC provide capital.

“We see this as a good example of an emerging substantial investable opportunity set for us, providing capital solutions to digitally-oriented non-bank lenders that are financing the needs of businesses investing in their products and customers,” said Aneek Mamik, partner and global co-head of financial services at Värde Partners.

Capital on Tap’s latest funding follows a bumper 2021 for UK fintech investment, with companies raising $11.6bn in capital.

This week, SME financing platform Stenn closed a $50m funding round at a $900m valuation.