UK banking-as-a-service (BaaS) provider Railsbank has secured $70 million in capital in order to promote its brand and products globally.
Railsbank‘s latest investment round has been led by Anthos Capital and received contributions from Central Capital (VC division of Indonesia’s largest privately-held banking institution), Cohen and Company (the founder of Bancorp), and Chris Adelsbach’s fund Outrun Ventures. Existing investors also took part in Railsbank’s funding round.
The fundraise has been announced after a $37 million round the BaaS Fintech finalized in November 2020. The company also confirmed that it has been focused on laying the foundations for its US launch.
Railsbank’s products have been created out of its “zero-legacy” core finance platform. They include BaaS and cards-as-a-service. Available through APIs, the platform offers a fast entry point into money-moving financial services for Fintech firms, telcos, supermarkets as well as major consumer brands.
Railsbank has emerged a key player in the embedded finance sector. The service provider is a regulated financial institution and principle card issuing member of Visa and Mastercard. This means that clients need not work with cumbersome legacy infrastructure and are able to access financial services seamlessly.
Nigel Verdon, Co-Founder and Railsbank, explains:
“Think of Railsbank as being the financial services layer of the Internet. 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.”
Bain Capital Ventures has forecasted that the international addressable market for embedded finance may be valued at around $7.2 trillion in the coming decade.
Chris Adelsbach, Managing Partner of Outrun Ventures, remarked:
“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. Embedded finance makes financial services far more accessible for customers and Railsbank has a solution that is in a league of its own.”