UK-based Tandem Bank has acquired Loop, a money-sharing app, to help it reach a “generation of climate-conscious consumers”.
Loop, which was founded by Tandem chair Paul Pester, will continue to operate as a standalone app and brand, following the deal.
Tandem confirmed it has plans to embed its own products and features in the Loop app, offering users access to a wider range of savings and lending services.
The “social network” app, which launched in early 2022, helps friends and family to lend money to and borrow money from one another, referred to as the money sharing market.
According to Tandem, nearly six million people are borrowing from friends and family each month, which amounts to approximately £12.5 billion of money being shared informally every year.
The app has positioned itself as an alternative to consumers relying on overdrafts, which it has estimated make incumbent banks more than £2 billion in profit each year.
Since its inception, Loop has targeted young professionals and students, reaching around two million people through its social and digital activities.
Alex Mollart, chief executive officer of Tandem, said the addition of Loop to its digital product range “fits perfectly” with the bank’s strategy.
“Tandem is on a mission to build the UK’s greener, digital bank – offering customers more sustainable ways to save, borrow and spend,” he said.
“Loop’s unique approach to money sharing offers users a real alternative to expensive overdrafts,” Mollart added.
“Given the app’s early success among Gen-Z users, the acquisition of Loop gives us a fantastic opportunity to grow Tandem’s customer base among a generation of climate-conscious consumers.”
At the start of 2022, Tandem acquired consumer lender Oplo, helping to broaden its product offering.
At the time, Oplo founder Mollart joined the combined business as deputy chief executive officer, taking over at the top of Tandem when Susie Aliker stepped down last year.