TruFin PLC (AIM:TRU) said its finance software subsidiary Satago Financial Solutions Ltd and Lloyds Banking Group PLC (LSE:LLOY) have inked a five-year commercial agreement under which Satago's software platform will be licensed for use by the bank's finance and factoring customers.
Customer access to the platform is expected during the fourth quarter of 2022.
The London-listed technology group said it has completed a further £2mln investment in Satago, as contemplated during TruFin's recent fundraising announced on March 22, 2022.
TruFin holds approximately 67% of Satago following this investment, which is the same pre-money valuation that Lloyds invested at for its £5mln investment, the company said in a statement. As Lloyds is a substantial shareholder, the signing of the commercial agreement constitutes a related party transaction under the AIM rules for companies.
TruFin confirmed that it continues to trade in line with market expectations and believes that the commercial terms are in line with market norms.
It said the Satago platform will enable Lloyds to further support UK businesses with a digitised proposition and that Satago will receive a recurring fee for each bank customer that uses the platform plus one-off implementation fees.
"The signing of this commercial agreement further solidifies our position as the best-in-class provider of innovative working capital solutions," said Sinead McHale, Satago's chief executive.
By working collaboratively with the bank, the aim is to deliver a solution that democratises working capital solutions for small and medium-sized enterprises (SME) all over the UK, regardless of size or sector, McHale added.
"By partnering with Satago, we are enhancing the choices and speed at which SMEs can access finance solutions which is fundamental to our purpose of helping Britain prosper," said Ben Stephenson, managing director at Lloyds Bank Commercial Banking.