London challenger bank OakNorth has secured approval from US regulators for a Representative Office, allowing the firm to market its products in the States.
The fintech unicorn announced on Tuesday its application had been authorised by the Federal Reserve and the New York State Department of Financial Services.
OakNorth, which in March posted a pre-tax profit of £187.3m for 2023, has been keen on expanding its digital banking footprint in the US.
The fintech group, which focuses its services on medium-sized businesses, said there is a gap in the US market for banks holding adequate assets to support middle-market firms.
Though the group has served US customers in the past, its new authorisation allows it to proactively market its products from a US office as it looks to acquire a banking charter.
“Without doing any marketing, we’ve done about three times more business in the US over the last year than we thought we would have done by this point,” said OakNorth co-founder and CEO Rishi Khosla.
“This is a clear demonstration of the demand from the lower mid-market for a banking partner like OakNorth, which can provide the speed, flexibility, transparency and entrepreneurial approach these businesses need to succeed and scale.”
This month, the SME Finance Taskforce chaired by the Centre for Finance, Innovation and Technology – of which OakNorth is a member organisation – called on the government to make data sharing a smoother process for businesses.