LHV Bank, the UK's newest licensed bank, has announced its partnership with online savings platform Raisin UK. This marks LHV Bank's first foray into the personal savings market and is a precursor to the launch of its direct-to-consumer savings offering in 2024. The aim of this partnership is to challenge the low interest rate environment and offer savers better rates. LHV Bank, known for being a digital-first bank, plans to leverage technology to deliver a superior digital savings experience for its customers.

The deposits from savers will also support SME lending, which is seen as a driver for economic growth by providing entrepreneurs with necessary finance. LHV Bank's SME lending division offers commercial real estate investment loans and trading loans between £0.5 and £5 million to UK SMEs. The bank's regional focus enables lending directors to better cater to the specific needs of local borrowers.

Raisin UK CEO, Steven Amos, believes that the partnership with LHV Bank will raise awareness among savers that there are better options available to them beyond traditional high street banks.

As a fully capitalised bank, customer deposits with LHV Bank are protected under the Financial Services Compensation Scheme (FSCS) up to £85,000. This move into the personal savings market comes after LHV Bank's acquisition of Bank North's SME lending business last year.

In addition to its presence in the UK, LHV Bank also operates in Europe as a provider of banking services. Its reported profit for the second quarter of 2023 stood at £1.4 million.