Azimo Founder Answers Osborne's Bank Call

A co-founder of Azimo, the UK-based money transfer service, is to answer George Osborne's call for a deluge of new banking start-ups with the launch of a digital lender next year.

Sky News understands that Ricky Knox, a well-known figure in Britain's technology investment sector, has been working on plans for the new bank for several months.

Mr Knox is working with Matt Cooper, founder of the Capital One credit cards business, and has raised around £10m in initial funding, according to people close to the situation.

John Llewellyn-Jones, a former HSBC executive, has also been involved in the project.

The project, which has the working title Open Bank but which is still finalising a consumer brand identity, is one of several undergoing scrutiny by regulators at the Financial Conduct Authority and Prudential Regulation Authority.

News of Open Bank's plans comes just days after Mr Osborne said that the Conservatives would ensure that at least 15 new banking licences were issued by regulators during the next parliament, compared with eight between 2010 and 2015.

Among the new lenders to have launched since the beginning of 2010 is Metro Bank, which became the UK's first new high street bank in more than a century.

Some bank executives questioned Mr Osborne's target, describing it as "arbitrary" and "meaningless".

Mr Knox, who founded Azimo in 2012, now runs Hexagon Partners, an investment firm focused on technology-enabled, financial services businesses.

Insiders said that around 40 people were working on the venture, with plans to raise up to £100m once it receives authorisation from regulators.

It will initially launch a range of savings and credit card products and will be a digital-only proposition focused on consumer retail banking, they added.

A string of other start-up banks have begun to emerge in the years since the financial crash, including Metro Bank and OakNorth, which recently announced that Lord Turner, the former chairman of the Financial Services Authority, would join its board.

Meanwhile, Atom Bank, a digital-only venture, is seeking to raise tens of millions of pounds from investors to join shareholders who already include Neil Woodford, the UK's best-known fund manager.

The Competition and Markets Authority is due to conclude an inquiry into the personal current accounts and SME banking markets later this year.

The perception that challenger banks will be assisted by Government policy ‎whatever the outcome of next week's Election has fuelled a rush of banks to raise equity on the stock market, with Aldermore, Shawbrook and Virgin Money all performing strongly since their listings.

A spokeswoman for Mr Knox declined to comment.