Digital financing institution LHV Bank has announced that the company is in the process of a new UK banking licence acquisition.

The Estonia-based financial body is already active in the region thanks to LHV Bank’s UK branch. However, the move towards a new licence will separate the bank’s business in both countries, ensuring that regulations are followed more closely.

Approval of the licence will come from the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA), but it could take up to 12 months if errors are found within the application. Furthermore, obtaining the licence will mean that LHV will move its UK operations from the LHV Bank UK branch to LHV UK Limited.

Erki Kilu, CEO of LHV UK, said: “It took exactly a year to prepare the materials needed to apply for the banking licence. We have been in constant communication with the regulators and promptly addressed any recommendations and feedback.

“In addition to working on the application, we have also grown our team in London to 25 people, with new people joining every week. If we take into account the 55 people in LHV’s Tallinn office who are directly involved in supporting LHV’s UK business, it is already a fairly large company.”

The UK branch of LHV Bank is already a financial partner to Wise, Trustly, Paysafe, Coinbase, and Monese, with a global customer base in the millions.

Some of the services included in the LHV portfolio are payments, card acquiring, and FX. The company is also part of the instant euro and pound settlement systems, making LHV capable of processing real-time transactions in both currencies thanks to their API. 

Kilu also expanded on the financial institution’s plans to increase employee support: “LHV UK will invest £8.5 million this year into people, technology and risk control systems. We will also open our second UK office in Leeds, where we plan to hire IT specialists and engineers.”

Adding on to the benefits that country-specific operations will bring, the LHV UK CEO said: “The complete separation of business activities also includes staffing and technology. LHV UK will use modern outsourced technology and cloud-native solutions like modular banking platform Tuum, payment processing platform Form3, anti-money laundering and compliance solution Salv, CRM system Salesforce, etc.”