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Railsbank raises $70 million to improve its API
The proliferation of the online approach for money transactions is making the financial technology segment more and more in demand. New startups emerge almost every day, and the competition is getting tougher. A huge number of banks, companies and retailers are switching to using special services for transactions, and interest in the developers of these APIs is steadily growing. A striking example is fintech Railsbank, which raised $70 million in the next round of financing.
The London-based company develops applications for banking services, payment cards, credit products, and more. The founder is Nigel Verdon, also known for the Currency Cloud project. The startup plans to use the investment to improve its solutions for the financial segment as well as expand its offerings to customers.
Railsbank decided to raise funds through the round of investment after a forecast of the integrated financial services market development from Bain Capital. According to it, it will reach $7.2 trillion by 2030. According to the startup, its goal is to simplify approaches in the sector, primarily in credit card transactions. Railsbank’s plans to develop APIs for banks and profile companies appealed to many investors, who invested heavily in the development of the startup. After the round, the company’s valuation increased significantly, but Verdon did not disclose the exact figure. It is only known that Railsbank is almost a unicorn, which means that the value is close to $1 billion.
The main fintech investors were Anthos Capital, in addition to which Central Capital, Outrun Ventures and others participated in the round.
It should be noted that the financial sector has a complex infrastructure, where it is necessary to integrate several processes. In turn, the product from Railsbank makes it easier to provide services such as credit card or bank account processing. Thanks to APIs, the service can be integrated with other platforms so that not only corporate customers but also ordinary consumers can use these products. Railsbank products are primarily aimed at non-banks, credit institutions and retailers who want to improve the level of service and make online payments available, but are not ready to invest resources in the development of a large-scale system.
An important advantage over its competitors, Railsbank points to the fact that it built the entire infrastructure from scratch, which is a more efficient approach than using a stack. In addition, the startup uses advanced solutions that allow it to implement market-relevant products faster than other market players. Also, Railsbank collaborates with other companies, which allows it to share experience and innovate together.