Flagstone adds US dollar & euro SME savings accounts

Flagstone has added US dollar and euro business savings accounts to its platform for UK small and medium-sized enterprises, targeting businesses that already hold cash balances in foreign currencies.

The new accounts sit alongside more than 200 cash management accounts already available to SME customers. Partner banks for the dollar and euro products include National Bank of Egypt and IsBank. Terms range from one month to seven years, with a top rate of 3.83% AER.

The launch expands Flagstone's offering beyond sterling savings for businesses managing cash across several currencies. The company says it oversees more than £20 billion in assets under administration and has built its business around giving customers access to deposits from multiple banks through a single online service.

Foreign currency holdings are common among smaller businesses that pay overseas suppliers, receive funds from international customers, or employ staff outside the UK. In many cases, those balances are held with different banks from a company's sterling cash, adding administrative work and making treasury oversight more difficult.

Flagstone's market analysis suggests about one in five UK SMEs, or roughly 1.05 million businesses, hold foreign currency balances. Among those businesses, 72% hold US dollars and 65% hold euros, according to a survey of 500 senior decision-makers at UK SMEs cited by the company.

Growing demand

Flagstone said the expansion followed demand from business customers seeking foreign-currency savings options with flexibility similar to the sterling accounts already offered on the platform. It added that some firms leave overseas currency balances in current accounts paying little or no interest because actively managing several banking relationships can be time-consuming.

Under the new arrangement, SME clients can view and manage eligible sterling, dollar, and euro savings in one place. According to Flagstone, the dollar and euro accounts are provided by UK-licensed, FSCS-authorised banks and building societies, meaning deposits qualify for the same level of FSCS protection as sterling cash held through the platform.

Businesses can also spread or stagger foreign currency balances across multiple accounts, mirroring an approach some customers already use for sterling deposits. The structure is intended to help firms manage access to funds over different time horizons while seeking returns on idle cash.

Flagstone said its average business user currently manages six savings accounts on the platform at any time. That points to the extent to which some SME customers are already diversifying cash holdings across multiple products and providers rather than relying on a single bank relationship.

Business focus

The introduction of multi-currency savings marks another step in Flagstone's effort to broaden its appeal among business customers, in a fintech area where firms are trying to simplify back-office finance tasks for smaller companies. Cash management has become more prominent for many SMEs as higher interest rates have made returns on deposits more meaningful and as more smaller businesses trade across borders.

For SMEs with irregular payment cycles, the issue is often less about foreign exchange trading than where operational cash sits between transactions. A business that invoices in dollars or euros may need to hold those balances for weeks or months before using them, making interest-bearing accounts in the same currency more relevant.

National Bank of Egypt and IsBank are among the first named providers for the new accounts, adding to the range of institutions already accessible through Flagstone's broader marketplace. The company has said it is the UK's largest savings platform by number of banks and accounts on its panel.

Flagstone's business model centres on aggregating deposit products from multiple providers and presenting them through a single interface for individuals and businesses. In the retail market, it also offers general savings accounts and cash ISAs, while in business and intermediary channels it works with wealth managers and financial services groups.

"SMEs that use our platform are able to optimise their deposits in GBP, but we have been acutely aware that providing a single point of access, visibility and management of their GBP cash was only part of the story. As our proposition for business customers grows, so does the profile of the standard Flagstone business customer. Today, our average business user manages six savings accounts on the platform at any time," said Katie Horne, Bank Partnerships Manager at Flagstone.

"By making USD and EUR savings portfolios available to any business using the Flagstone platform, we are equipping our business clients with an even easier, faster cash management solution that works across currencies, freeing up teams to get back to scaling their businesses in whichever direction they choose."