$70M Raised By British Fintech Start-Up TrueLayer In Funding Round To Rival Visa And Mastercard

The continued interest and favouritism of investors for fast-growing fintech firmclompanies arounf the world was at display again as the British financial technology start-up TrueLayer saying that it raised $70 million in fresh funding.

The known as APIs, or application programming interfaces technology offered by TrueLayer allows the connection between fintech apps such as Revolut and Freetrade and the bank accounts of their customers. That essentially means that users making use of those apps zare able to make payments from their bank or view balances and transactions from different accounts.

Addition, the venture capital firm founded by former Tiger Global partner Lee Fixel led the latest investment round, the company said. The existing investors of the company including Anthemis Group, Connect Ventures, Mouro Capital, Northzone and Singapore’s Temasek also participated in this latest investment round.

The strong growth experienced by the company in 2020 encouraged the company to decide to raise more cash, said Francesco Simoneschi, TrueLayer’s CEO and co-founder. The company noted that the Covid-19 pandemic, and a shift from consumers toward digital means of managing their finances helped the company to grow in last year.

“We were closing 2020 in an extremely positive way,” Simoneschi said in a television interview. “We were going through an incredible year of growth,” he said, adding the company saw its payment volumes spike as much as 600 times.

The company’s financials or valuation was not disclosed by TrueLayer. Till date, the company has raised as much as $142 million in funding and it also has the Chinese internet giant Tencent as a shareholder.

Its plans of international expansion will be financed by the fresh cash that it has raised, TrueLayer said. The expansion plans include building the company’s presence in Europe first and then venturing into the Australian market. The plan of whether to also expand into the Brazilian market in the near future is also being considered by the company.

A day ago, the United States based firm Plaid and a rival of TrueLayer in Europe had announced that it had raised $425 million in fresh investments in the company at a market valuation of $13.4 billion. Last year, the acquisition offer for Plaid for $5.3 billion was initially agreed to by the later, the deal was however scrapped by the company following antitrust concerns being raised by the US government.

Both Plaid and TrueLayer are identified to be a part of a new movement in the fiancé world which is known as “open banking” which has the aim of opening up of the very precious banking data and payment services to fintech firms and other approved third parties – provided that customers’ consent is available with them. Sweden’s Tink and Britain’s Bud are the other firms that operate in this space.

“Open banking can be a real contender to the traditional card networks,” Simoneschi said. “The question is, can the card companies embrace this change, or will they resist?”

“I think competition is good and benefits the ecosystem,” Keith Grose, Plaid’s head of international, said and added that the firm has “good competitors” but that its rivals don’t offer the “transatlantic bridge” it’s built with operations in both the US and Europe.

(Adapted from CNBC.com)

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