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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
SumUp has raised $306 million (€285 million) in combined equity and debt funding.
The round was led by Sixth Street Growth. Bain Capital Tech Opportunities, Fin Capital, and Liquidity Capital also participated in the investment.
The funding round does not change SumUp’s valuation which, as of June 2022, stood at $8.5 billion (€8 billion).
London-based fintech SumUp has secured $306 million (€285 million) in growth funding. The round was led by Sixth Street Growth and featured participation from Bain Capital Tech Opportunities, Fin Capital, and Liquidity Capital. The company will use the funding, which includes a combination of equity and debt, to support international expansion.
The round reportedly does not change the company’s most recent June 2022 valuation of $8.5 billion (€8 billion). It follows SumUp’s announcement of a $100 million credit facility from Victory Park Capital earlier this year.
In a statement, SumUp CFO Hermione McKee credited the merchants on the company’s platform – more than four million strong – for the company’s growth. “(It) is a direct result of the success of the traders we serve and would not be possible without the unwavering trust and support of the investor community,” McKee said. “This funding gives us additional firepower to pursue growth opportunities and accelerate products that empower small businesses.”
Founded in 2012, SumUp provides businesses of all sizes with affordable payment products and financial services. The company won Best of Show in its Finovate debut at FinovateEurope in 2013, and has since grown into a major payment solutions and point of sale systems provider active in 36 markets around the world. These markets include Australia, where SumUp launched in August.
More recently, the company introducedTap to Pay on iPhone for SumUp customers in both the U.K. and the Netherlands. This enables SumUp merchants to accept all types of contactless payments using only an iPhone and the SumUp iOS app. No additional hardware is required. SumUp sees the offering as ideal for new and smaller merchants looking to potentially scale their businesses and broaden payment options for customers. SumUp Senior Strategic Growth Manager Giovanni Barbieri underscored the technology’s ability to support financial inclusion. “I am especially pleased with the exceptional functionality of the product and the fact (that) it lowers barriers to entry, with the potential to fuel entrepreneurship.”
This spring, SumUp launched its multi-product subscription offering, SumUp One. The new solution amalgamates the company’s product suite in a single, unified solution for merchants. SumUp One initially launched in Italy and the U.K.
Intelligent compliance technology company Napier has teamed up with client lifecycle management platform KYC Portal.
The partnership wil help companies eliminate the problem of siloes in compliance operations by integrating know your customer (KYC) and compliance processes.
KYC Portal made its most recent Finovate appearance at FinovateEurope in 2019.
Intelligent compliance technology company Napier and client lifecycle management platform KYC Portal have announced a new partnership. The two companies will work together to help companies integrate know your customer (KYC) and compliance processes, removing the problem of siloes from compliance operations.
KYC Portal’s KYC Portal CLM is a Customer Due Diligence (CDD) and anti-money laundering (AML) orchestration platform. The solution works in real-time to automate, centralize, and simplify the due diligence process. KYC Portal CLM boosts efficiency with a dynamic workflow that reduces both risk exposure and the cost to maintain that risk. Integrating KYCP’s technology with Napier’s transaction monitoring module will provide faster, more accurate alerts to compliance professionals.
“KYC is the ability to know your customer, their activity, and whether it poses risk to your organization,” KYC Portal founder and CEO Kristoff Zammit Ciantar said. “With knowledge on the entire customer lifecycle, from onboarding and beyond, compliance teams are empowered to have a greater view on customer risk.”
Founded in 2008, KYC Portal most recently demoed its technology at FinovateEurope in London in 2019. At the conference, the company demoed its compliance solution that enables organizations to collate all data on subjects under review. This data resides in a single, centralized, secure repository with customizable parameters, rules, user rights, and collaborative functionality.
KYC Portal began the month with news that its platform had earned a spot on the RegTech 100 for 2024. Earlier this year, the Malta-based company announced an integration with global identity verification platform Shufti Pro. KYC Portal also announced this year a number of platform enhancements to make integration with third-party data sources easier.
Looking to demo your latest fintech innovation? Applications are now being accepted for demoing companies at FinovateEurope in London, February 27 and 28, 2024. Visit our FinovateEurope hub for more!
Financial crime and AML specialist Refine Intelligence has raised $13 million in funding.
The round was led by Glilot Capital Partners and Fin Capital. The capital will be used to fuel international expansion.
Refine Intelligence made its Finovate debut at FinovateEurope earlier this year in London.
Financial crime solution provider Refine Intelligence has secured an investment of $13 million. The funding round was led by Glilot Capital Partners of Tel Aviv, Israel, and FinCapital of San Francisco, California. Also participating in the round were SYN Ventures and Ground Up Ventures, among others. The company, which made its Finovate debut earlier this year at FinovateEurope in London, will use the capital to help fuel international expansion.
“Banks used to have a superpower: knowing their customers’ life stories so they could provide personalized financial service,” Refine Intelligence CEO Uri Rivner said. “With banking increasingly done online and a significant drop in face-to-face interactions, banks’ understanding of customer behavior is limited.”
To this end, Rivner explained, Refine Intelligence helps banks better identify the false alarms that can be inadvertently triggered by otherwise legitimate customer activity. This strategy of helping banks “catch the good guys,” as Refine Intelligence puts it, enables financial fraud teams to focus on truly suspicious behavior.
The list of transactions that most often trigger false alarms is fairly alarming in its own right. According to Refine Intelligence, 64% of all AML alerts come from just five scenarios: payments for cash-intensive workers, gift giving or receiving, automobile purchases or sales, and payment for construction projects. Devoting resources to the false alarms that plague these transactions is a time-consuming and inefficient process that Refine Intelligence helps eliminate for banks.
Founded in 2033, Refine Intelligence made its Finovate debut earlier this year at FinovateEurope in London. At the conference, the company demoed its Life Story Analytics solution. An anti-money laundering solution “designed for real life,” Life Story Analytics leverages AI to identify the “life story” behind any alert issued by the transaction monitoring system. The technology automatically explains the issue with the transaction in question to the fraud monitoring team. This enables teams to clear alerts faster, provide full explainability to regulators, lower caseload, and improve overall risk management. Refine Intelligence says the technology has produced a 90% reduction in time and resources devoted to managing alerts.
In addition to the company’s recent funding, Refine Intelligence was recognized this summer in the AI FinTech100. The roster highlights companies in financial services that are innovating in the field of AI.
Read our Finovate Global interview with Refine Intelligence CEO Uri Rivner. Long time fintech fans may recall that Uri Rivner previously founded behavioral biometrics company and Finovate alum, BioCatch.
Looking to demo your latest fintech innovation? Applications are now being accepted for demoing companies at FinovateEurope in London, February 27 and 28, 2024. Visit our FinovateEurope hub for more!
Qatar’s leading digital bank, Qatar Islamic Bank (QIB) has teamed up with Visa and sustainability-as-a-service innovator ecolytiq to help customers better understand the environmental impact of their financial activity.
“This partnership marks a monumental shift in the market,” ecolytiq co-founder and Managing Director Davis Lais said. “Climate engagement in banking is coming to Qatar.”
Courtesy of the partnership, QIB will integrate a new Carbon Emission Tracker feature into its mobile app. The tracker will help foster environmental awareness among banking customers and encourage climate-friendly spending behavior and consumption habits. The technology will also enable QIB to determine the carbon footprint created from its retail banking customers spending activity and use that data to refine both specific transactions as well as customer profiles.
Lais added, “Our innovative work with QIB and Visa is giving banking customers in Qatar more transparency and choice to live sustainably. We are proud to have been chosen to help QIB guide their customers through the complexity of the environmental crisis by making this a fundamental part of QIB’s banking experience. QIB has decided to embrace the future of banking by being a part of it.”
The new partnership follows the release of QIB’s third sustainability report. The report articulated the bank’s sustainability initiatives, noting progress in steps taken to manage climate-related risks. This includes QIB’s adoption of the Equator Principles, making ESG concerns a part of the bank’s risk management process.
This month, QIB was named “2023 Bank of the Year in Qatar” by The Banker magazine, a Financial Times publication. In accepting the award, QIB Group CEO Bassel Gamal referenced the banks efforts toward greater sustainability. “We have assumed a substantial role in championing the shift towards a more sustainable economy, incorporating ESG (Environmental, Social, and Governance) factors in our credit assessment and risk management processes, thus promoting sustainable practices among our corporate borrowers.”
Established in 1982, Doha, Qatar-based, QIB reported total assets of more than $4.6 billion (QAR 187 billion) this year. The bank has 23 branches, more than 170 ATMs, and approximately 36% of the total assets of domestic Sharia-compliant banks.
ecolytiq’s partnership with QIB is the fintech’s second big win in MENA in as many months. In November, ecolytiq – along with Visa – worked with Dubai-based Mashreq to facilitate the launch of the bank’s climate banking platform. The platform overlays carbon emissions calculations onto transaction data, and leverages advanced carbon footprint analytics to personalize climate insights.
Founded in 2020 and headquartered in Berlin, Germany, ecolytiq introduced itself to Finovate audiences at our developers conference, FinDEVR 2021. In addition to its bank partnerships, ecolytiq also has teamed up with a number of fintechs. These include partnerships with fellow Finovate alums Mambu in July and Tink in June. Mambu will make ecolytiq’s sustainability-as-a-service solution available via its marketplace that serves more than 100 million end users. The Tink partnership will embed ecolytiq’s carbon tracking services and other sustainability features into its open banking platform.
“Pairing open banking with sustainable banking is good news for financial institutions looking to make a difference,” ecolytiq co-founder and Managing Director Ulrich Pietsch said.
Treasury Prime, an embedded banking software platform, has signed a strategic partnership with fraud and risk management platform Effectiv.
Companies and FIs on Treasury Prime’s network will leverage Effectiv’s platform for transaction monitoring.
Effectiv made its Finovate debut in September at FinovateFall. The company is headquartered in San Francisco.
Embedded banking software platform Treasury Prime has forged a strategic partnership with fraud and risk management platform Effectiv. The new relationship will enable companies and FIs on Treasury Prime’s network to access transaction monitoring technology from Effectiv to reduce fraud and improve risk management.
Effectiv offers a no-code, fraud, risk, and compliance platform that helps FIs fight fraud at every point in the customer journey, from onboarding to real-time transaction monitoring. The platform identifies and monitors high-risk and high-value transactions for potentially anomalous or fraudulent behavior. This lowers the risk of financial loss for customers and the potential for reputational damage to institutions. Effectiv’s technology automates compliance and risk management, providing more than 80% reduction in manual review, and 58% reduction in fraud and risk management costs. Since inception, Effectiv has processed more than $41 billion in automated risk and fraud decisions.
“Over the past year, we’ve seen a rise in fraud with real-time payments,” Effectiv co-founder and CEO Ravi Sandepudi said. “As banks get ready to adopt FedNow and AI fraudsters increasingly get more sophisticated, it’s critical that fintechs and banks invest in technology that can improve their security posture.”
Effectiv made its Finovate debut earlier this year at FinovateFall. At the conference, the company demoed how its unified fraud, risk, and automated compliance platform helps institutions safely facilitate high-risk and high-value transactions.
Headquartered in San Francisco, California, Effectiv has raised more than $9 million in funding. This sum includes a $4.5 million seed round in July led by Better Tomorrow Ventures. Effectiv also used the funding announcement to preview its new biometric solution, DeviceIntel. The telemetrics and intelligence solution analyzes and identifies suspicious activity on user devices. Effectiv COO and co-founder Ritesh Arora referred to DeviceIntel as part of the company’s “holistic evaluation approach” to fighting fraud.
Interestingly, the team that founded Effectiv in 2021 previously launched fraud detection company Simility. Acquired by PayPal in 2018. Simility introduced itself to Finovate audiences as part of our developers conference series FinDEVr in 2017.
Founded in 2017, Treasury Prime offers a range of core banking solutions including accounts, payments infrastructure, and enhanced FDIC insurance. The San Francisco, California-based company also leverages its embedded banking software to facilitate connections between banks and enterprise partners, as well as offer a partnership marketplace. Chris Dean is co-founder and CEO.
A newly announced partnership between institutional payment orchestration platform Paydock and Australia’s Commonwealth Bank (CBA) will give merchants in Australia the ability to offer their customers a range of new payment options. This new flexibility comes courtesy of PowerBoard, which provides a dynamic payments experience to customers via API, without requiring businesses to make major changes to their existing payments infrastructure.
“Our partnership with CommBank sets a global precedent for financial institutions,” Paydock CEO and founder Rob Lincolne said. “It shows not only how banks can bring flexible payment strategies to customers in record time with payments orchestration, but also it establishes a new paradigm whereby banks can become more competitive and deliver more value by working with fintech players.”
PowerBoard will make it easier for CBA to deploy the latest payment methods, types, providers, and processors to merchants. CBA General Manager of Merchant Solutions Karen Last noted growing customer interest in new payment options. In a statement, she highlighted alternatives such as account-to-account payments, digital wallets, and Buy Now Pay Later as reasons to pursue the partnership with Paydock.
“PowerBoard makes it significantly easier for Australian merchants to offer choice to customers and manage their payments ecosystems, without all the costly integrations,” Last said.
Headquartered in London, Paydock also maintains an office in Sydney, Australia. The company has raised $31.8 million (£25 million) in funding according to Crunchbase. This capital came in the form of a Series A investment in May that was led by IAG Silverstripe.
Commonwealth Bank of Australia is one of the top 50 banks in the world. Founded in 1911, CBA became a fully private bank in 1996. The institution is part of the “big four” of Australian banks, along with the National Australia Bank (NAB), ANZ, and Westpac. CBA had total assets of 1.2 trillion AUD as of 2022.
Speaking of Commonwealth Bank, the institution also announced this week that Bendigo Bank and fraud monitoring firm Satoriwill pilot CBA’s NameCheck technology. Launched this spring, NameCheck is built to prevent scams and mistaken payments. According to the bank, the solution has prevented more than 10,000 scam payments and reduced mistaken payments by more than $100 million, to date.
“With scams and fraud costing Australians and businesses billions of dollars annually, it’s clear a whole of ecosystem response is needed to combat this problem,” CBA Group Executive Business Banking Mike Vacy-Lyle said. “We are proud to be able to extend our industry-leading technology to others and contribute to protecting more Australians against cyber criminals.”
NameCheck leverages advanced technology and CBA’s access to payment data to help establish the accuracy of account credentials. Bendigo Bank will integrate NameCheck into its Up app. Financial fraud monitoring company Satori will also take advantage of the technology.
“We are excited to work with CBA and extend the NameCheck service to our corporate customer base to complement the existing AI driven financial controls monitoring service driving operational efficiency and preventing fraud,” Satori Executive Director of Growth Mark Bookatz said.
Founded in 2002, Satori is headquartered in Sydney, Australia. The company has more than 200+ customers in the APAC region who rely on its automated transaction monitoring services. These firms include Afterpay, Qantas, and Volkswagen Group.
The Australian government’s plans to regulate Buy Now Pay Later services are having a hard time keeping up with public enthusiasm for the payment option.
This week, the Reserve Bank of Australia (RBA) shared results of a survey that indicated a significant increase in use of Buy Now, Pay Later services. The specific demographic was individuals between the ages of 18 and 39. The survey showed that more than 40% of those in this cohort had used BNPL services in the past year. The survey, which had almost 1,000 participants, also noted an overall increase in the number of people using BNPL. Incorporating data from a Reserve Bank of Australia research paper from 2022, the RBA determined that there has been an increase of 8% in adult BNPL use since 2019.
Designing a regulatory framework for Buy Now Pay Later services in Australia has been on the government’s to-do list since the spring. The goal is to bring BNPL under the umbrella of existing credit regulations, including credit license requirements, and minimum standards on conduct, services, and products. This also includes mandating that BNPL companies conduct credit history checks. Overall the regulations, which will treat BNPL services as conventional lending products, are seen as among the toughest proposed.
But the rollout has hit a snag. The RBA has announced that the new regulatory framework for BNPL will arrive next year rather than at the end of 2023 as originally planned. The reason for the delay was “resourcing pressures” on the government’s legislation writing team. And while this will likely give New Zealand regional bragging rights over its larger neighbor when it comes to adoption of BNPL regulations, the impact of the delay on the Australian BNPL market should be slight.
Here is our look at fintech innovation around the world.
Transaction Assurance automates effectiveness testing. This ensures that all transactions are both monitored and tested.
Cable made its Finovate debut last year at FinovateFall 2023. Co-founder Natasha Vernier is CEO.
Effectiveness testing platform Cablehas launched its financial crime compliance and transacting testing solution, Transaction Assurance. The new offering automates effectiveness testing to ensure that all transactions are both monitored and tested for potential regulatory breaches or control failures. This helps banks, fintechs, and payment platforms avoid the limitations of manual dip sampling.
Cable founder and CEO Natasha Vernier explained that the recent spate of compliance lapses – and the billions in fines paid by major institutions for these lapses – have revealed specific problems in financial crime prevention methods, including the way these processes are tested.
“These cases have brought to light gaps in existing protocols, including systemic failures in manual testing,” Vernier said. “These industry shortcomings are why we developed Transaction Assurance. It helps illuminate the vast, often untested expanse of transactional data, bringing that previously unseen 99% into sharp focus.”
Transaction Assurance acts as a sophisticated translation layer. The solution amplifies the effectiveness of first-line control systems by synthesizing and testing data in real-time. This ensures continuous adherence to an institution’s policies and controls. Transaction Assurance delivers actionable insights and alerts, as well as detailed reporting and analytics. This gives managers maximum transparency with regards to the institution’s compliance status.
“It is either Cable or four more people,” Steven Eisenhauer, Chief Risk and Compliance Officer for Ramp Network, a Cable client, explained. “No one questions the expense for that reason. For our size and volume, you would expect a larger team, but we have literally tested more transactions than all of our competitors.” Ramp Network and Cable announced their partnership in February.
Cable made its Finovate debut last year at FinovateFall. At the conference, the company demoed its Automated Assurance solution that enables banks and fintechs to automate their compliance assurance and effectiveness testing. The company’s technology also streamlines a number of manual compliance processes including stakeholder reporting and record management.
This year, Cable has forged partnerships with credit card company Yonder, digital bank Grasshopper and, in October, with unsecured business and personal loan specialist BHG Financial.
Founded in 2020, Cable introduced new Chief Revenue Officer Candace Sjogren in August. Sjogren most recently served as SVP, Global Head of Sales at crypto-as-a-service company Zero Hash. Cable has raised more than $16 million in funding, according to Crunchbase. This includes $11 million in a Series A investment from CRV, Jump Capital, and Stage 2 Capital announced in May.
The Fintech Founders series, presented by our sister publication Fintech Futures, features fintech and financial services veterans sharing their insights and experiences on a range of topics important to businesses in our industry.
Today we share five conversations on fintech funding featuring our panel our fintech experts. As part of our Funding Series of discussions, our panelists talk about issues such as: bootstrapping versus external funding, finding the right investment partners, the importance of producing significant growth, as well as tips for entrepreneurs and surprises our panelists encountered in their own journeys in fintech and financial services.
Money transfer company Paysend has raised $65 million in funding. The round featured a strategic investment from partner Mastercard.
The investment adds to Paysend’s $125 million Series B round, which closed in 2021.
Paysend made its Finovate debut at FinovateEurope in London in 2016.
International money transfer company Paysend has secured $65 million in funding. The round included a strategic investment from Mastercard, which announced a partnership with Paysend earlier this year. That alliance helped enhance cross-border payments for SMEs by way of its Open Payments Network (OPN).
Existing investors Infravia Growth Capital, One Peak, and Hermes GPE Innovation Fund also participated in the round. This week’s investment follows the company’s $125 million Series B round, which closed in 2021.
A Finovate alum since its debut at FinovateEurope in London in 2016, Paysend provides fund transfers to more than 170 countries. The company’s platform ensures transparency by displaying currency rates, transfer fees, and the receivable amount before each transfer. Paysend users can make transfers via bank cards, accounts, and even mobile numbers. Money transfers are certified by Visa, Mastercard, China UnionPay, and are PCI DSS certified, as well.
“This significant investment is a testament to the strength of Paysend’s vision,” Paysend CEO and co-founder Ronnie Millar said, “to build the best-in-class cross border solutions for businesses and consumers, making money transfer simple for everyone.”
Paysend’s funding news comes just days after the company announced a partnership with CalQRisk. The company offers a governance, risk management, and compliance (GRC) solution that Paysend will use to enhance its current risk management processes. In October, Paysend teamed up with fellow Finovate alum Western Union. This partnership provided Western Union customers with a new direct to card payout option.
Paysend is headquartered in London, U.K. The company entered the Israeli market this summer after partnering with Israel-based fintech Okoora.
Core banking platform 10x Banking has formed a strategic partnership with B2B lending technology company Trade Ledger.
The two companies will offer banks and alternative lenders solutions to help them better serve small and medium-sized businesses.
10x Banking won Best of Show in its FinovateEurope debut earlier this year.
Cloud-native core banking platform 10x Banking and B2B lending technology company Trade Ledger announced a strategic partnership this week. The two fintechs will work together to offer banks and alternative lenders a composable banking solution to help them better serve their SME customers.
Specifically, the collaboration will enable FIs to introduce a variety of new, more complex, working capital solutions to market. These include invoice, receivables, and supply chain finance products. A real-time API connection between Trade Ledger’s data platform and 10x Banking’s SuperCore platform allows credit applications to be linked to the creation of a new 10x customer account. Trade Ledger manages the loan application, risk assessment, and the risk and collateral management operations. 10x Banking handles account opening and the credit account life cycle.
“Automating integration between credit applications and account creation allows banks to deliver a superior customer experience, while also driving operational efficiency,” 10x Banking’s VP and Global Head of GTM and Partnerships, Frederico Venturieri said. “This collaboration reflects our shared vision of leveraging technology to revolutionize the business banking landscape.”
The strategic partnership seeks to close what the company called in a statement “the global working capital credit gap.” A report by Allianz estimated this liquidity gap to be $30 trillion worldwide, with SMEs impacted the most. Among the culprits are high acquisition costs, which make lenders reticent to take on small business customers. Another issue is an overly complex and lengthy application process. The partnership between 10x Banking and Trade Ledger responds to both the challenges of account opening, as well as the problem of access to working capital.
“Combining our lending automation capabilities with 10x’s core banking expertise, we can redefine how financial institutions onboard customers and manage the lending process,” Trade Ledger VP of Channels Alan Walsh said.
Founded in 2016 and headquartered in London, U.K., 10x Banking made its Finovate debut at FinovateEurope in March. The company won Best of Show for its 10x SuperCore Cards solution that enables banks to build a card proposition in minutes. More recently, 10x Banking has forged partnerships with compliant open banking API technology company Ozone API and mortgage sales and origination software provider Iress. In August, the company introduced new Chief Product Officer Okan Ozaltin, formerly of Signifyd and Fiserv.
10x Banking has raised more than $252 million in funding according to Crunchbase. Antony Jenkins is CEO.
Looking to demo your latest fintech innovation? Applications are now being accepted for demoing companies at FinovateEurope in London, February 27 and 28, 2024. Visit our FinovateEurope hub for more!
While not as headline-grabbing as the AI craze, the speed with fintechs, banks, and financial services companies have embraced environmental sustainability may be one of the underrated stories of 2023. This is true for both “green financing” which supports the funding of climate-supporting initiatives as well as “green fintech” which involves the development of products that enable sustainable finance and eco-investing.
In 2023 alone, we have seen companies like ClimateTrade, Cloverly, Connect Earth, and GreenPortfolio demo their climate-conscious technologies on the Finovate stage. These companies shared innovations such as blockchain-based climate and carbon credit marketplaces, carbon tracking API technology, and climate impact scoring for investments. And before these companies were firms like Energy Shares in 2022 and ecolytiq in 2021 that introduced equity crowdfunding for utility-scale renewable energy projects and environmental impact data for payment transactions to Finovate audiences.
But are we making the most out of the current moment? A recent blog post by fintech observer and author Chris Skinner references a relevant column by James Vaccaro, Director of Corporate Strategy at Triodos Bank. Vaccaro took a critical look at present-day efforts by banks and other financial institutions to adopt more climate-friendly policies. His conclusion was that current efforts such as decarbonization are laudable, but often suffer from poor management.
Yes, there is some subterfuge and greenwashing going on, but many initiatives do have authentic intentions – they’re just not working optimally and need to be redesigned and upgraded.
Also, the recurrent phenomenon of there not being enough finance for green projects, but finance not having enough green projects to invest in, suggests that we’re not just dealing with a funding gap. There are systemic barriers at play and these need to be addressed with innovative solutions to unblock flows of finance.
Vaccaro notes that some solutions, such as carbon tracking calculators, have not turned out to be the killer sustainability apps that many hoped they would be. Nevertheless, he clearly sees a need for further investment in both green fintech and green-friendly finance – to use our previous taxonomy. He cites approvingly offerings like social impact bonds. He also is helping the Climate Safe Lending Network launch its Climate Finance Catalyst Contest to develop financial solutions to support the decarbonization of the financial industry.
Regulators are paying attention to the problem. In their report on environmentally sustainable finance, the International Money Fund, the World Bank, and the OECD “highlight(ed) the need for scaling up private finance to support the transition to net zero.” That aside, the report noted two, potentially related, challenges that are worth noting. These were the lack of frameworks and scoring methodologies (particularly in developing economies) and market fragmentation.
These issues are not new to financial services. And while there is much work to be done, these kinds of challenges are being effectively tackled in many areas of fintech and financial services – from payments to credit risk and lending. Often, as is the case with sustainable finance, enabling technologies such as blockchain, machine learning, and AI are driving factors enabling us to leverage data in new ways. This bodes well for the potential to make sustainable finance possible, and especially where it is needed most.
Peloton did not disclose the names of the investors. The company did say that members of the investing team have joined Peloton Technologies’ advisory board. The seed funding comes four months after the company secured $1.5 million (CAD $2 million) from the Pacific Economic Development Agency of Canada (PacifiCan). The funding from PacifiCan was the second investment Peloton received from the agency. The company picked up CAD $500,000 in funding from PacifiCan’s Business Scale Up and Productivity (BSP) program in 2022 ($367k in today’s dollars).
“We’re thrilled with the response from the Private Investor community,” Peloton Technologies Executive Chair of the Board John MacKinlay said. “We have a world-class group of investors with deep background in payments, banking, risk management, compliance, accounting, IT architecture, and securities law.” MacKinlay added that the funding will also help Peloton Technologies execute its acquisition strategy; last month, Peloton announced the acquisition of KIS Payments, an ISO (Independent Sales Organization). MacKinlay also noted that this week’s fundraising was a “precursor” to a “larger capital raise” slated for the first half of 2024.
“We’ve spent a lot of time creating the most comprehensive solution for businesses and now it’s time to scale,” CEO Craig Attiwill said when the company acquired KIS Payments in October.
Founded in 2011, Peloton Technologies helps small and medium-sized businesses in Canada process payments, execute fund transfers, exchange currencies, and store payment data. Its platform also supports the integration of multiple payment methods across multiple financial institutions. Peloton’s proprietary technology ensures the secure storage of payment data, document management, email/SMS notifications, and scheduling, as well as providing a sophisticated rules engine.
