LHV Bank, which acquired a UK banking licence in May, announced on Thursday that it is partnering with Estonian SaaS provider Tuum to roll out a new loan system for its SME Lending business. Erki Kilu, CEO of LHV Bank, says, 

“This integration with Tuum is a key step in our continuous effort to provide a framework that enables our SME Lending business to develop a wide range of new products quickly, allowing us to swiftly adapt to changing market demands.”

According to LHV Bank, the move improves resource allocation and simplifies lending architecture. It will allow the bank to roll out new products quickly to adapt to changing market demands. Furthermore, it creates a resilient, future-proof framework that will help the bank avoid legacy system challenges.

LHV Bank’s lending business provides commercial property and trading loans of up to £5M (€5.8M) to small and medium enterprises in the UK. Predominantly operating in Manchester, it aims to fuel economic growth in underdeveloped business hubs.

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LHV Bank launches new core banking system

In August, LHV Bank launched an updated core banking system for its Bank Services division, which serves 200 fintechs worldwide. The new system ensures more efficient GBP payments, enhancing reliability and scalability for the bank’s client base in the UK.

“When building this system, we chose to collaborate more extensively with external value-adding service providers, transitioning all systems to cloud solutions and enhancing in-house agile software processes,” says Kilu.

The current change involves moving the bank’s customers to Tuum’s platform. Tuum CEO Myles Bertrand asserts that LHV Bank’s transition to the service provider’s cloud-based system further strengthens their partnership and will benefit clients.

“Clients that operate multiple business lines from our system see the best returns and reduced cost of ownership,” Bertrand remarks. 

Besides collaborating with Tuum to expand its Banking Services business line, LHV Bank partners with Salesforce for customer management and Salv for payment monitoring. 

Last week, LHV Bank also announced a partnership with online saving platform Raisin UK. It is the bank’s first step in its plan to launch direct-to-customer savings product offerings next year.

Tuum helps banking firms avoid legacy problems

Estonia-based SaaS firm Tuum provides banking solutions for financial institutions across Europe and the UK. 

Tuum says that many financial firms rely on their legacy systems, making it challenging to adapt to the rapidly changing market. 

It offers several solutions for these firms to transform and scale their businesses. Tuum offers modules for core banking, lending, cards, and payments, the four critical functions in banking services. 

Tuum’s core banking module streamlines the management of accounts, transactions, deposits, and pricing. Its lending module accommodates the loan management process, from application to contract. 

The card module facilitates the issuance of debit and credit cards. Banking firms use Tuum’s payment module to initiate and validate payments based on their preferred payment formation rules.

About LHV bank

LHV Bank is a child company of Estonia-based LHV Group, a publicly traded financial firm specialising in financial services. 

Established in 2012, it began servicing fintech clients in Estonia. LHV Bank then entered the UK market in 2018 by opening a London office.

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