Railsbank, an embedded finance platform, has raised $70 million in funding. Anthos Capital led the round.
14th July 2021: Railsbank, the leading global Embedded Finance platform, has raised USD$70 million in its latest funding round.
The latest fundraise was led by Anthos Capital and attracted a range of investors including Central Capital (VC arm of Indonesia’s largest privately held bank), Cohen and Company (the founder of Bancorp), and Chris Adelsbach’s new fund Outrun Ventures. Existing investors also participated.
Railsbank will use the funds to further expand its various Embedded Finance products (Banking as a Service, Cards as a Service, and Credit as a Service) across Europe, Asia Pacific and North America, to help its customers remodel and democratise access to the financial services industry. The Railsbank platform is used by customers such as fintechs, telcos, supermarkets and consumer brands to innovate fast and radically improve the way millions of consumers and SMEs access, use and manage their money.
Railsbank is unique in the Embedded Finance market, offering the only truly global platform; by having rails directly connected into the financial system thus bypassing the industry legacy infrastructure; and being both a regulated financial institution and principle card issuing member of Visa and Mastercard. It maintains that many of the Embedded Finance and BaaS providers in the market today are just software layers sitting on top of legacy financial institutions. This means that although customers benefit from improved APIs, they still have to endure the underlying industry legacy infrastructure, operations, risk policies and ways of working.
“Think of Railsbank as being the financial services layer of the Internet,” said Nigel Verdon, CEO and co-founder of Railsbank. “We are transforming the finance industry in the same way that Apple did to the music industry when they created iTunes. Too much of the current global financial services system is made up of aging legacy technology and operational processes, making it unnecessarily complicated, highly expensive and nearly impossible for innovators to create the ‘Spotify’ of financial services.
“We are changing that at Railsbank by combining our ‘zero legacy’ platform with deconstructing financial services into individual digital components. Because we have created these individual financial components, our customers can easily embed financial products directly into their own customer experiences at exactly the point where consumers and SMEs need financial services, not at the point when traditional providers forced them to. This will finally make financial services customer centric and inclusive, rather than the situation today which is institution centric and exclusive.”
Betsy Cohen, Chairman of Fintech Masala and founder of Bancorp, added: “The market has evolved so rapidly since we founded the world’s first BaaS business, the Bancorp. As we move into the $7 trillion embedded finance market, it has been great watching Railsbank’s growth story. With this investment, it’s a privilege to continue to be part of the journey with a global leader like Railsbank.”
Chris Adelsbach, Managing Partner of Outrun Ventures, commented: “Outrun Ventures are thrilled to support Railsbank in their recent financing. I’ve had the benefit of being on the front-line of Railsbank as an early investor and Advisory Board member and have been incredibly impressed by their growth. More importantly, as an early stage fintech investor, I’ve witnessed a remarkable change in the volume of companies that are building next generation businesses using Railsbank. I speak to dozens of founders every week and I’ve rarely gone through a week where a company doesn’t tell me that they are working with Railsbank. When I asked them ‘why’, their collective responses gave me the conviction to make a later stage investment. Embedded finance makes financial services far more accessible for customers and Railsbank has a solution that is in a league of its own.”
Railsbank is a global leader in BaaS and Embedded Finance, empowering a company, or a brand, to easily prototype, build and scale any financial use case. Its customers use Railsbank’s super simple APIs as building blocks to deliver exciting products for their own end users, including apps that help manage and distribute money in real-time, reflecting the needs of the 21st century financial consumer.