UK Modern Slavery Act statement 2024

Background

Ikano Bank AB (publ) (Ikano Bank, the Bank) is a signatory to the UN Global Compact and its underlying principles on human rights, labour rights, environment, and anti-corruption. These principles are being increasingly incorporated into a rapidly growing body of law and policy at the national level, such as the UK Modern Slavery Act 2015 (The Act). The Act sets out a range of measures on how modern slavery and human trafficking are dealt with under the UK law. This is Ikano Bank’s statement for the financial year ending 31 December 2024.

About Ikano Bank

Ikano Bank, started by the founder of IKEA, is supervised by the Swedish Financial Supervisory Authority (Finansinspektionen) and mainly delivers services online. The head office is located in Malmö, Sweden and the company is registered in Älmhult, Sweden where the business was once founded.

Ikano Bank has operated its business under a banking license from the Swedish Financial Supervisory Authority since 1995 and is present in Sweden, Denmark, Norway, Finland, the UK, Germany, Austria and Poland. The foreign operations are branches of the Swedish entity, whereas operations in Austria is conducted by the German branch.

Ikano Bank AB (publ) UK branch is based in Nottingham and operates primarily within consumer finance.

Ikano Bank is a part of Ingka Group, the largest IKEA retailer who operates IKEA sales channels under franchise agreements with Inter IKEA Systems B.V.. In October 2024 Ingka acquired the remaining 51% shares in Ikano Bank AB (publ) from Ikano S.A., and became the sole shareholder of the Bank.

Ikano Bank creates possibilities for better living by offering simple, fair and affordable services, enabling a healthy economy for the many people and businesses. In the Bank we work every day to make a difference, by offering financial services on fair terms and contributing to a better future through accessible financing that supports sustainable living for our customers. Our long-term mission is to be a trusted and sustainable bank, making us the natural choice for the many people and businesses.

Policies and commitments

Ikano Bank is committed to the highest standards of ethical conduct, and we expect the same commitment from our customers, business partners (suppliers, partners and brokers) and employees. To us, sustainability is at the core of our business, not an add-on. Our retail heritage lays the foundation for our purposeful, customer-centric and values driven culture. The long-term mission is anchored in our values; working together, common sense and simplicity, and daring to be different, and guided by our promise; On fair terms. This forms the basis for how we grow our people and business, ensuring efficient ways of working, clear governance, leadership skills, competency, and continuous development.

Our efforts to handle actual and potential adverse impacts on fundamental human rights are guided by the following initiatives;

UN Guiding Principles on Business and Human Rights
The UN Universal Declaration of Human Rights
UN Global Compact
OECD Guidelines for Multinational Enterprises
The International Labour Organization’s Declaration on Fundamental Principles and Rights at Work

Guided by above initiatives human rights are incorporated into our policies, instructions and directives. The most critical being the;

Ikano Bank Human rights policy
Ikano Bank policy on business relations
Ikano Bank Partnership policy “In business with Ikano” (used towards our business partners)
Ikano Bank Code of conduct policy

Value chain and due diligence process

At Ikano Bank, we address human rights across our operations and throughout our value chain, guided by our Partnership policy and supporting governance framework. We have identified that our most critical human rights risks arise through the use of business partners (suppliers, partners, and brokers) in both our sourcing activities and in our B2B and B2C business.

We rely on a wide range of business partners to support our services, and responsible sourcing plays a role in how we select, engage, and manage these relationships.

Business partners providing critical or important services are subject to both our pre-onboarding and ongoing third-party management processes. These processes include regular performance reviews, compliance monitoring, screening through trusted data providers, and risk assessments that cover areas such as human rights, labour conditions, and information security.

We expect all business partners to operate in alignment with our core values and to comply with relevant laws and regulations. In 2024, we enhanced our due diligence process by participating in the UN Global Compact’s Business & Human Rights Accelerator, focusing on applying the OECD Guidelines for Multinational Enterprises. We also completed our annual assessment of the UN Global Compact’s Ten Principles through the updated Communication on Progress (COP), which provided further insights into improving our practices within both our operations and value chain.

Human rights assessment and monitoring breaches

As part of our ongoing due diligence, we implemented our own Human Rights Policy in 2024 and updated our internal risk framework to reflect our reassessed risks. In 2025 we will introduce a revised Partnership policy clarifying our expectations and due diligence processes for all business partners.

No high-risk exposures were identified in our own operations. However, we have identified the following salient risks from a banking industry perspective within our sourcing and commercial activities: right to privacy, protection from harassment, equal pay, decent working conditions, living wage, and labour rights including freedom of association.

We have introduced more stringent contractual requirements for partners where there is a higher dependency on workforce conditions, particularly around working hours, pay, labour rights, and occupational health and safety.

Supplier and partner screening is included in our due diligence routines. If negative or adverse information would be identified, then Ikano Bank would carry out an assessment and this may result in termination of the partnership. During the reporting period, Ikano Bank has not identified any cases of concern that would require such an action.

In 2024, we implemented ESG assessments across both upstream and downstream business partners. An independent external provider conducts ESG rankings based on pre-defined thresholds. For new B2B partners with low ESG scores, targeted follow-up assessments are conducted, forming the basis for improvement discussions. These ESG reviews are integrated into our onboarding process and will gradually expand in scope. Annual reassessments are planned for all critical or important business relationships.

Training for employees and board members

All employees are enrolled to our mandatory training framework during the onboarding process. The mandatory trainings are repeated on an annual basis and cover what all employees need to know about relevant laws, regulations and the Bank’s steering documents. The purpose of the trainings is to educate each employee on what they have to know about the Bank’s operations to mitigate risks and be compliant.

The mandatory training framework includes:

Training that is legally required (e.g., AML, Data Protection)
Training that is required from a compliance perspective (e.g., Code of conduct, Consumer duty, Anti-bribery, Whistleblowing)
Training that is essential and legally required to fulfil specific job role (e.g., Complaint manager, Agreement owner, Outsourcing contracts)

The training for board members is arranged once per year. As part of the annual self-assessment of the collective suitability, efficiency and functioning of the Board topics to enhance the knowledge and competence of the Board are identified and included in the annual training. Updates and training on regulatory changes are always included. Furthermore, mandatory training topics can be added to the training agenda.

Grievance mechanism and remedy process

Ikano Bank’s whistleblowing process ensures that all stakeholders, including customers, business partners and employees have the right to speak up and always feel safe doing so if they have concerns about suspected misconducts such as breaches of human rights or irregularities such as fraudulent, inappropriate, dishonest, illegal or negligent activity or behaviour in our value chain, operations, products or services. This includes any action that constitute a violation of laws or regulations or of our internal policies, instructions and directives.

Multiple internal and external channels are provided, such as regular employee engagement surveys and local market compliant procedures for people to raise their concerns and seek remedy. This includes giving access to the dedicated whistleblowing platform EthicsPoint (https://ikano.ethicspoint.com) This provides anonymous reporting, and allows employees to report a concern in their own language.

For external stakeholders, consultants (both hired and self-employed), shareholders (being active in the business), persons working under the supervision and direction of suppliers or contractors, temporary staff, volunteers, job applicants, and former co-workers or other persons in a work-based relationship, there is a link to Ikano’s independent reporting channel on Ikano Bank UK’s website here: - https://ikano.co.uk/about-ikano.

Malmö 5 June 2025
Ikano Bank AB (publ)

Niclas Olsson
CEO