Effectiv AI, a fraud and risk management Fintech, has announced a $4 million seed round led by Accel. REV (funded by RELX) and other angel investors participated in the funding round.
Co-founded by ex-Simility executives which was acquired by PayPal in 2018, Effectiv seeks to provide an AI-enhanced service that is accessible to any financial services firm regardless of size.
Effectiv service is a no-code platform that can help mid-sized banks, credit unions and Fintechs to reduce the cost of managing fraud and risk
Effictive states that banking and financial institutions have rapidly digitized. Meanwhile, fraudulent activity has boomed causing losses of around $19 billion in 2020.
Ravi Sandepudi, co-founder and CEO of Effectiv, explained that discussions with industry insiders has helped them to validate the gap that exists in the market:
“Cutting-edge technologies that drive Effectiv have so far been prohibitively expensive and were designed for and by large organizations. Effectiv aims to change that and truly democratize AI-driven risk management, making it accessible to any financial institution. Every organization, regardless of size, should have access to best in class safety measures to protect their members and customers.”
Ritesh Arora, co-founder and President at Effectiv, said they are building a platform that is designed from the ground up to be extremely easy to integrate and implement.
“Effectiv comes integrated with best in class data services and our proprietary AI decides when to optimally use (and pay for) a data signal. Our goal is to help teams manage their risk strategies without relying on developers.”
Effectiv states that it will use the funds for tech development, growing the team in the US, and marketing its services. Effectiv onboarded its first customer in June 2021 and has already processed over $1 billion in loan volume, according to the company.
After a closed beta, the platform is now live and the team is actively onboarding new customers. The company has also brought on board industry veterans Bob Stock as an advisor and Mike Persichini as Head of Sales to boost growth in the US.
“As the world is on a digitization spree, we know that challenging times are ahead for financial institutions. We see tremendous value in Effectiv’s innovative approach to fraud and risk management. Their powerful yet rapidly adaptable AI platform could be the key to identifying these changing trends. We are looking forward to working with the Effectiv team in making these world class solutions accessible to every financial institution,” stated Dinesh Katiyar, Partner at Accel.
