Save-as-you-spend company Ffrees Family Finance has secured £2 million from some of the UK’s most successful business people, to build up its innovative, Sheffield-based service.
The funding round was significantly oversubscribed.
Investors in the Electric Works-based business include the Technology & Innovation Fund, run by the London Bridge Software team which specialised in retail banking systems, the former head of investment banking at Merrill Lynch Europe and Nomura vice chairman Justin Dowley and former group finance director of Schroders Kevin Parry.
“Ffrees targets the millions of families for whom saving is a distant dream. Customers can open a current account online for free and receive a Ffrees debit card. When they buy products and services from Ffrees partners, who include high street retails, they are rewarded with Ffrees Savings Points, paid as cash into a separate savings account.”
Ffrees founder and chief executive Alex Letts said: “Ffrees is the New Kid on the Block in the basic current account sector, which is the slave of a centuries old banking business model.
“Millions of families today are not good business for the banks unless they can be charged fees and penalties. Not surprisingly families are unhappy. So we are rewriting the equation.
“The truth is that the High Street banks’ Rolls Royce offerings are just not relevant to millions of UK families today.
“Most people simply need a free on-line facility, which helps them manage their money and save up.
“Modern technology allows this but legacy bank business models and infrastructure get in the way.”
Ffrees launched in January last year and currently receives over 100 new account applications per day. At present, nearly £1 million a month is being put into Ffrees accounts.