SYDNEY, Australia – Railsbank, a global open banking platform, now got the backing from the payments giant Visa.
Following the Series-A funding in September 2019, which allowed Railsbank to raise $1 million, the open banking and compliance platform picked up another investment, now from Visa. Railsbank also bagged additional funding from a venture capital firm in Tokyo, Japan, Global Brain. Although the specific amount of investment from the companies is undisclosed, sources stated that it could be worth several millions of dollars.
Two fintech veterans, Nigel Verdon and Clive Mitchell, founded Railsbank in 2016. The experience came from the fintech Currency Cloud, which Mr Verdon previously founded.
The fintech pair discovered a gap in the market where they can create a business to provide other firms and companies with a platform to allow them to rapidly design, build, launch, and operate any financial services or products they are offering.
Compared to traditional banks, Railsbank offers services as a global open banking platform, operating as a financial services function for other fintech firms. It is a platform, which other companies can leverage from in launching, scaling, and designing prototypes of new financial products that they are planning to offer their customers.
Aside from the recent funding it received, Railsbank also announced that it already retained a 5-year partnership with payments giant to provide Banking as a Service (Baas) modernization in Southeast Asia. The open banking platform also revealed that it became a principal issuing member of Visa recently.
In a statement given by the company, taking part in the Fintech Fast Track Program of Visa and being its principal member will give Railsbank access to the fast-growing partner of the payments giant. That also includes access to Visa’s expert and technologies, which could enable all customers in Railsbank to effectively and quickly release Visa based product all over Asia and elsewhere.
Nigel Verdon, the chief executive and co-founder of Railsbank, said that the company’s recent partnership with Visa shows their intent and efforts to become one of the most innovative and advanced banking platform company across the Asia Pacific.
Mr Verdon further stated that their platform is API focused, which is the most convenient way for rapid digital finance products conceptualization, building, and launching for any company, brands, or business. Notably, he said, if companies want to incorporate the product suits and capabilities that Visa offers.
To that end, the open banking platform is positioning itself as a convenient system on which other businesses can build and launch a wide variety of financial services or include different fintech features on the products they are selling. Among companies that can leverage on Railsbank as a utility are challenger brands, fintech startups, and other banks
Mr Verdon also provided examples of what the open banking platform can offer and its endless capabilities. He described the process that SingLife went in developing a 100% working digital banking application in only two days. The app, he added, has SingLife’s debit card but also supports transactions from other banks as well as compatibility with dedicated account numbers.
According to him, the rapid process of designing, building, and launching the SingLife app was possible with the help of the Railsbank platform and API. These factors provide integration hooks and tech compliance to create a full financial system and banking experience.
And while most existing clients of Railbank remains other fintech firms, Mr Verdon commented that the platform is also working with various companies and brand, including those in retail and travel in offering financial products to customers. He said that Railsbank is also joining forces with bigger traditional banks to provide a system and utility infrastructure that could help minimize their operational costs.
When Railsbank closed its Series-A funding late last year, Mr Verdon compared it to the same thing that Amazon made for the AWS data centres.
He said that Railsbank is a useful platform for the entire financial services backend, offering the platform, operations, connectivity, regulation, compliance, and scheme memberships like one with Visa.
Meanwhile, the Europe Office Representative and a Partner at Global Brain Corporation, Naoki Kimamaeda, stated that they see a high possibility for the vision that Railsbank have as well as the open banking platform in general. The representative’s statement also explained that corporate companies, particularly across Asia, are becoming more open and willing to engage in banking services, and Railsbank is a convenient platform to provide them with the solution.
Global Brain Corporation is also excited to be part of the bold vision of Railsbank and is looking forward to actively provide their support in the platform’s expansion in Asia, especially in Japan, the statement said.
Currently, Railsbank is London-based, but also has offices in Sri Lanka, Philippines, Lithuania, and Singapore. However, during the announcement of its Series-A funding last year, Railsbank already expressed its plans for further expansion. With the recent additional investment from Visa, it will not be surprising that the open banking platform will announce new expansion plans and measures in the coming weeks.
During its Series-A funding last September when Railsbank raised $10 million, it announced that the capital injection would fund the platform’s plans to expand further than Europe. Its initial plans include venturing in markets in the United States, Southeast Asia, and Australia.
Among the investors in the funding are Moneta Capital, Singapore Life, Clocktower Technology Ventures and CreditEase, with Moneta Capital leading the round.
Meanwhile, another fintech startup based in Hong Kong, Neat, also secured a Series A funding from the payments giant Visa. The said investment is worth $11 million. Various investing companies also participated in the financing round, including Pacific Century Group (PCG), MassMutual Ventures, Sagamore Investments, Linear Capital, and Dymon Aisa Ventures. The PGC led the investment round.
The latest investment pool secured by the company now brings the total funding raised by Neat to $16 million. According to the fintech firm, the latest investment will go into their efforts in terms of customer support to offer around-the-clock services to all their clients.
Neat is also planning in building the next group of Neat credit cards by joining forces with Visa that will be soon available to their business customers.