TrueLayer, the London-based startup that provides a developer-friendly platform for businesses, including other fintechs, to use open banking, is unveiling $ 70 million in new funding.
Series D is led by new investor Addition. Existing investors including Anthemis Group, Connect Ventures, Mouro Capital, Northzone and Temasek also participated. New investors include Visionaries Club, Zack Kanter (CEO of Stedi), Daniel Graf (ex-Uber, Google, Twitter) and David Avgi (former CEO of SafeCharge, CEO of UniPaaS).
TrueLayer claims the Series D brings the total investment to date to $ 142 million. The capital injection will be used to continue to expand its open banking network, which brings together payments, financials and identity to enable businesses to create new products that improve “the way we spend, save and make money.” online transactions ”.
This will include the further development of high-end open banking services that go beyond simple access to open banking APIs and enable more innovation in financial services, including integrated finance and payments in general.
To do this, and to meet what it says is growing demand, TrueLayer is expanding its engineering, product and sales teams. In the last 12 months, fintech has extended its services to 12 European markets.
Over the years, CEO and Co-Founder of TrueLayer, Francesco Simoneschi and I have often pontificated on the use case or use cases of open banking. We can finally have our answer: payments.
This is because one aspect of open banking is payment initiation, which allows an authorized third party to initiate the transfer of money from your bank account on your behalf instead of card payments, which have no never intended for online payments.
“We believe that open bank payments will become the default way to pay online, replacing other payment methods within the next five years,” says Simoneschi. “Open banking is digitally native and mobile first, transferring money at a fraction of the cost, securely and conveniently, while providing a much better customer experience.”
The past year has also revealed some of the issues with existing payment methods as people have turned to digital channels to manage all aspects of their lives. “The problem is with the cards,” says the CEO of TrueLayer, “that weren’t designed to be online and that have been adapted to today’s online payment flows. The new digital approaches such as Google Pay or Apple Pay on these cracks, but do not change the fundamentals ”.
Simoneschi says the company has seen the use of its payments API grow rapidly as more consumers embrace instant bank payments. Volumes have grown 600 times over the past year, driven by more companies adopting open bank payments, including Revolut, Trading 212, Freetrade and Nutmeg.
“We typically find that one in 3 customers choose the open bank payment option after trying it once,” he notes, revealing that for some customers, over 70% of their customers use the open. banking as the main method of payment.
“There are a number of reasons why this makes sense for customers. On the one hand, they don’t need to remember the details of the card. Instead, they authenticate with their face or fingerprint on their mobile device, instantly and securely. Plus, they’ll never need to update stored details if their card is lost, stolen or expires ”.
Open bank payments as a payment option also benefit merchants, argues Simoneschi. “These payments typically convert 20% better than cards (and up to 40% with our feeds) and have success rates over 95%, which equates to millions or hundreds of millions of revenue collected in the end. of the year, ”adds TrueLayer co-founder.