Manchester-based InsurTech company Fruga has raised £1 million to expand its open banking-powered platform, which helps policyholders reduce their insurance costs at renewal by earning rewards through everyday spending.
The funding round was supported by NPIF II – PXN Equity Finance, managed by PXN Ventures as part of the Northern Powerhouse Investment Fund II, alongside Haatch, a UK venture capital firm that combines investment with practical support for growing businesses.
Previously self-funded, Fruga plans to use the investment to expand its team, with several key hires expected in the first quarter of 2027. The company also intends to broaden its customer base, supported by a developing pipeline of established household-name insurers and managing general agents (MGAs).
Fruga’s platform allows policyholders to link a bank account or credit or debit card to their insurance policy through open banking. Eligible purchases made with participating partners across sectors including travel, grocery shopping and high street retail earn insurance credits. Customers accumulate these credits throughout the year, which can then be used to reduce their premiums at renewal. The rewards can frequently exceed £150, while also providing benefits during the policy term.
Money Expert is among the businesses already using Fruga’s technology. Through the integration, its customers can earn credits when shopping with participating brands, building up rewards that can help offset their insurance expenses. The offering aims to address the ongoing pressure insurance costs place on household budgets.
The platform also enables insurers to offer the service under their own brands. This gives insurance providers opportunities to gather customer insights and engage with policyholders throughout the year, rather than relying primarily on interactions during claims or renewal periods.
Fruga co-founder McCarthy highlighted how purchasing behaviour could help insurers identify relevant customer needs. For example, if transaction data indicates that a household is buying pet products, an insurer could proactively offer pet insurance before the customer begins searching for cover through a price comparison website.
Fruga developed the platform around the idea that insurance could benefit from a continuous layer of customer value, drawing inspiration from the way consumer banking brands such as Monzo and Revolut have enhanced their services through digital features and open banking. By combining customer rewards with transaction insights, the company aims to help insurers deliver additional benefits while developing a better understanding of their policyholders.
