Global open banking platform TrueLayer joined the unicorn club this week as its new billion dollar valuation indicates both the opportunity and the excitement surrounding open banking in Europe.
Read more: TrueLayer notches $ 130 million at a value of $ 1 billion backed by Tiger, Stripe
The $ 130 million funding round, led by Tiger Management with participation from payments giant Stripe, will allow UK-based FinTech to expand its open banking technology to enable open bank payments, as well as accounts. instant and recurring direct. payments to individuals and businesses around the world.
As PYMNTS reported, 2021 was a boom year for the company, with monthly payment volume increasing 400% and monthly payment value increasing 800%. The company said it has processed billions of payments, expanded across Europe and doubled its user base.
Related: TrueLayer CEO: Merchants Will Drive Open Bank Payments To Ubiquity
In April of this year, the CEO of TrueLayer Francesco Simoneschi told PYMNTS’s Karen Webster that the open banking revolution will be led by merchants, with TrueLayer predicting that 60% of individuals in the UK will have tried open banking by September 2023.
He added that improving payment capacity and functionality will lead to more verticals that will gravitate towards open banking, and while there may not be a ‘big bang’ moment. , there will be a revolution involving development cycles that will extend from technology to digital. first FinTechs in the most remote corners of the trade.
“This is a very recent technology and there is a dynamic that is self-reinforcing, where we are moving from early adopters to the more traditional and mature parts of the ecosystem,” Simoneschi said of the bank. opened.
The company’s UK headquarters were one of the first to adopt financial practice in January 2018, when open banking became a regulatory requirement in the country. Since then, the application programming interface (API) call volume rose from 66.8 million to almost six billion between 2018 and 2020.
In August, the company announced that it had received approval from the Central Bank of Ireland (CBI) as a payment institution and had established its new European headquarters in Dublin, Intelligence IBS reported.
Make instant bank refunds possible
In a June interview with PYMNTS, Osama Soliman, Product Manager at TrueLayer, said that while EU and UK regulations don’t necessarily require instant bank refunds as part of open banking, TrueLayer has found it helpful to enable this feature.
“Refunds have been the missing piece of the puzzle to make sure open bank really works,” he said, adding that “for the large number of merchants, the higher conversion rate of open bank payments, combined with the ability to instantly process refunds and payments, [result] in an improved end-to-end payment experience.
TrueLayer recently announced a partnership with UK online car retailer Cazoo, with the retailer’s new payment system powered by TrueLayer’s open bank payment method. Cazoo can now enable direct payments to a bank account and faster refunds for consumers using its platform.
Expanding the reach of Open Banking beyond the UK
And while TrueLayer continues to make its mark in the UK, global payments giants Visa and Mastercard have accelerated their own moves in the EU’s open banking space.
Read more: Visa acquires Swedish open banking platform Tink for $ 2.1 billion
In June, Visa announced plans to purchase Swedish open banking platform Tink for $ 2.1 billion “to drive innovation and empower consumers in support of Europe’s open banking goals. According to the CEO and president of Visa. Al kelly.
Founded in 2012, Stockholm-based FinTech operates an open banking platform that allows users to connect to more than 3,400 European banks and institutions through a single API. The platform also enables banks, FinTechs and merchants to access personalized financial data and products that, combined with Visa’s infrastructure and fraud prevention, businesses expect to advance the bank open in Europe.
See also: Mastercard acquires Danish open banking technology company Aiia
Related news: Mastercard’s Jess Turner: Pandemic aside, Consumers Are Making the Decision
Earlier this month, Mastercard agreed to acquire one of Europe’s leading banking technology providers, Aiia, following its $ 825 million acquisition of the US-based open banking platform. United Finicity last year.
See also: Finicity CEO Sees Open Bank, Consumer Authorization Central to Future of Lending
The Danish open banking technology company has more than 400,000 users. Similar to Tink, it bridges the connection to banks and financial institutions (FIs) through a single API, integrating hundreds of banks and FinTechs on its open banking rails since its launch in 2010.
In an interview with PYMNTS, Executive Vice President of North America Products and Innovation at Mastercard Jess turner said the growing prevalence of instant payments and the desire of consumers to move and control their own financial data and information has led the company to actively seek solutions to help people have more choice and enjoy more payments. fast.
“I think we will continue to develop these use cases […] and we’ll continue to see how we can innovate and scale up for different experiences, Turner said, adding that “things like enabling easier account acquisitions and allowing consumers to more easily move data, open a new account and sending and receiving funds – these are things that really make sense to consumers.