Ronan Horgan, the CEO of Capitalflow
The Dublin based company, backed by British private equity firm Pollen Street Capital, employs around 60 people and has lent over €650 million to a broad range of small and medium sized businesses (SMEs) across a range of sectors.
Following the takeover, Capitalflow plans to advance over €1.2 billion in new lending over the next three years to Irish SMEs and property investors.
It is also expects to be able to offer more competitive rates to customers here as well as grow the range of products it can offer amid rising demand.
“From Capitalflow’s perspective we become a wholly owned subsidiary of bunq and we can avail of its competitive funding through its deposit base,” said Mr Horgan.
“Our intention is to scale our business over the coming years and be a credible alternative business lender to the pillar banks.”
“We have invested heavily in a digital platform over the past 18 months that will allow us to scale, and we hope in time to add further products in time.”
Capitalflow had its best months since its establishment in May and June of this year as the economy started to reopen.
The takeover by bunq follows interest from a number of potential suitors over the past six months, Mr Horgan said.
“Bunq bank launched in 2015 and it has grown its deposit base to over €1billion,” he said.
“Unlike other digital banks, bunq charges its customers for the use of its services so it has taken a different route to market than most of the others by charging a premium for its products and services.”
Pollen Street Capital will becomes a shareholder in bunq following the deal.
The news of the takeover came as bunq reported its first ever profitable month.
It now expects to break even on a monthly basis by the of this year.
Bunq also raised €193m in a deal with Pollen Street Capital, valuing it at €1.6bn – the largest Series A round ever raised by a European fintech.