Griffin nabs U.K. bank license, £19M in new funding

Griffin, a U.K.-based Banking as a Service startup, has raised £19 million and obtained a banking license from local financial services regulators.

Why it matters: The license enables Griffin to offer a full range of banking, payments and wealth solutions without having to partner with another bank.

Zoom in: The company's £19 million (~$24 million) Series A extension was led by MassMutual Ventures, NordicNinja and Breega, with participation from existing investors Notion Capital and EQT Ventures.

Driving the news: Roughly a year after starting the application process, the U.K.'s Financial Conduct Authority and Prudential Regulation Authority granted Griffin a full banking license.

• Griffin founder and CEO David Jarvis says the opportunity to build its own core banking system and operate with a bank license was part of the reason for launching the company in the U.K.
• "If you only tried to deliver this through technology, you would have a bunch of issues, some of which would be around risk and compliance, and others, which would be around margins," he says.

Context: Around the same time Jarvis and co-founder Allen Rohner began working on Griffin, they saw a spate of new tech-forward banks being spun up in Europe.

• He says that in the U.K. in particular, regulators have been working to increase competition by helping startups and new entrants obtain banking licenses.

Between the lines: That puts it in contrast to most BaaS startups in the U.S., which partner with sponsor banks to provide API-based financial services offerings to their clients.

• "The U.S. is ... not the easiest place in which to set up a new bank," Jarvis says.

Flashback: Griffin last raised a $13.5 million Series A round led by MassMutual Ventures in June.

• The company has raised around $52 million since being founded in 2017.

Go deeper: Banking as a Service turmoil