Banks offer £5m to fintech firms developing SMB apps

Nesta is offering 5 million to companies who develop apps for small businesses in the UK.

The innovation foundation's Open Up Challenge will give the cash to 20 winners that prove to the organisation their applications and services are changing the way business is conducted.

Those winners will also get access to a tranche of anonymised UK banking transaction data under the project, to help make their apps more effective.

Banking corporations including Barclays, Lloyds, Santander, HSBC, Royal Bank of Scotland and three Northern Irish banks have all put money forward to support the competition and it will be their anonymised data companies entering into the competition will be able to use. However, Nesta will run the competition itself.

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"Open Banking is potentially revolutionary for how banking looks and feels and works," says Chris Gorst, Open Up Challenge prize lead at Nesta told Wired. "The purpose of the prize is to stimulate innovations for small businesses in the UK using that opportunity."

Nesta is appealing for companies to put their ideas forward from 23 March until 31 May, when the call for entries will close. At this point, the organisation's judging panel, including Rowena Ironside from accelerator Digital Catapult and Open Data Institute's CEO Jeni Tennison, will shortlist 20 companies to go forward onto the next round.

Those selected will receive a cash grant of 50,000 in July, which they can then use to develop their ideas to be in with a chance of winning an overall 2 million cash prize.