Entrepreneur Jim McColl’s Alba Bank is ready to ‘mobilise’ after finally securing a licence for Scotland’s first bank solely dedicated to small and medium sized business lending.

After five years of talks, the Bank has been approved by the UK Prudential Regulatory Authority (PRA) and the Financial Conduct Authority.

The bank will initially operate from two office hubs in Glasgow and London with longer term ambitions to establish commercial offices in regions across the UK. It aims to become Scotland’s version of new-style digital banks such as Monzo and Revolut.

An experienced team has been assembled, led by former Airdrie Savings Bank chief Rod Ashley. Former Scottish Financial Enterprise CEO Graeme Jones was appointed chairman last October.

Its backers include Sir Brian Souter, the former Stagecoach boss, David Coulthard, the former Formula One motor racing driver and David Moulsdale, who runs the opticians chain Optical Express.

The team at Clyde Blowers, founded and chaired by Mr McColl, have been actively working alongside the Alba team to secure the banking licence since Alba was set up in 2018.

Clyde Blowers has also led the capital raising for Alba to date, supported by several like-minded business entrepreneurs. The bank has now raised sufficient capital to support the mobilisation phase and beyond.

A Series A funding round steered by Seismic Venture Partners was launched in early 2021 to raise £5m directly aimed at smaller investors with a minimum investment size of £1,000.

The bank had been due to launch in the second half of 2021 but the plan was delayed by the impact of the pandemic and current economic conditions.

Commenting on the licence, Mr Ashley, said: “This is unquestionably a landmark moment in our journey so far. I am incredibly proud of the team who have steadfastly believed in our mission of launching a new SME focused bank and have worked tirelessly to build a comprehensive business plan, which has allowed us to receive our licence from the regulators.

“SMEs have long been regarded as the lifeblood of our economy but haven’t always received access to appropriate levels or forms of finance.

” Alba is an opportunity to design a bank specifically with these businesses in mind, helping them to realise their true potential and fulfil their vital role in enhancing both employment and economic growth.

“Alba’s proposed high tech, high touch business model, marrying the latest innovative digital technology with skilled relationship managers and personal judgement, will differentiate us within the UK SME lending market.”

Graeme Jones, chairman, said the bank now enters into “full mobilisation”.

He said: “Alba’s establishment is not only important to the Scottish banking and financial services community, but also to the Scottish economy where the majority of our working population are employed in SME businesses.

“The bank has a dynamic and ambitious agenda which, through time, will see it operating across the UK regions from its initial bases in Glasgow and London.

“Whilst we will be a high-tech SME bank utilising the best financial technology available to serve our customers, we also place equal value on our customer relationships.

“We need their voice at the very heart of the bank to ensure we stay relevant, understand their changing needs and to provide a more personalised and bespoke service.”