BlackRock backs Trustly, bank transfer payments platform now valued at over $1B – TipsClear

Online payment is often synonymous with card payment, but today a startup that has made a profitable choice, based around paying and taking via bank transfer, is announcing a round of funding amid a surge of growth is.

By belief, a Swedish startup has created a platform to make it as easy (and competitive) for merchants to accept bank transfers as it is to collect card payments to complete online transactions, announcing today It has been raising a significant round of funding. From a group of investors led by BlackRock.

In an interview, Trustee CEO Oscar Berglund said the company and its investors are not disclosing the right amount of investment, but we understand from reliable sources that the deal values ​​the company – which is profitable and last year at $ 150. It had a revenue of over million. Over $ 1 billion, and it will give blackrock And others participating in the investment (including Aberdeen Standard Investment, Niburger Burman, Investment Corporation of Dubai and funds managed by RSIC) have a minority stake in the business.

For some more background, private equity group Nordic Capital essentially acquired € 700 million in 2018 ($ 794 million at today’s rates). The deal represents a partial exit. The thing we understand is that the base transaction also increased with this transaction.

It’s on both sides of the growth – both organic and inorganic, since it merged with US rival PayWithMyBank last year to expand its network to touch 600 million consumers – and a trusted list of customers. That list today has more than 6,000 merchants and includes Facebook, where you can find its logo for people to buy ads and pay through trustees; AT&T, which lets people pay bills using the network; To shop in Europe; Topping in PayPal accounts in many countries; And sending and receiving money through TransferWise.

It also essentially puts this investment in the range of hundred / crore / lakh.

Reliably evolves as to how e-commerce is evolving, as it continues to mature and become more ubiquitous – a trend that has intensified over the past several months due to several social equilibrium measures Have gone away from shopping physically.

When many of us think about online payments, we usually use a credit or debit card to process this, or maybe log into a mobile wallet to complete a transaction. But the reality is that payment is a much more fragmented business, with consumer and merchant preferences changing with each sector and includes wider options than Visa, MasterCard, Amex and PayPal, or some other wallet.

Bank transfers as a method of payment are not common at all in some markets, particularly those where cards have become ubiquitous. For example in the UK only about 5% of online transactions are done this way.

But in other markets, it is a very common and well-used route. In Austria, Estonia, Finland, the Netherlands and Poland, most consumers prefer to pay via bank transfer – the rates are 50%, 50%, 40%, 60%, 45%, respectively, reliably tells me, its Numerous data sources, including some of its payment partners, Aidan, PPRO, Global Data and Worldpay, based on the data.

And Berglund said the picture is a positive for Trustworthy – and competes with other companies, including Kallan from Sweden (another startup ‘Unicorn’, as it happens) – because it appears to be bank-based transfers On Boom is as a payment method.

There are many reasons for that innings. Perhaps most clearly, we have seen a lot of security issues surrounding card usage, including numerous stories of malicious hackers breaching network security of businesses and stealing data and card numbers, and other types of card fraud. Are included. Even as more water processes are implemented (such as mandatory chip-and-pin transactions in many countries), there are drawbacks as well as general discomfort among consumers.

On top of this, the tides are changing in consumer centric financial services. In particular, thanks to the rise of mobile apps and the plethora of startups that have created “challenger banks” to provide more user-friendly banking, consumers today want and expect more control over their finances.

For many, the use of credit cards represents a departure from that, given that they are designed to help you get more than you can actually afford, so that you pay with interest. Pay back in increments. And, I would argue, even debit cards can be a departure from transparency, because you’re still not seeing your account balance in real-time when you shop, and many people have it again. There are overdrafts to spend, which they actually have to spend.

“I think the bank transfers Burgund said that plays into the younger generation of millennials who do not want to intentionally fall into the debt trap, while being used in real time.

If the story for end users – whether they are consumers who are making purchases or merchants who are selling – is all about transparency, easy user interfaces and simplification, this is because the work under the hood is very complex and fragmented. lives. It is the same here.

Trustley’s network, Berglund explained, is reliably based on establishing its own business accounts in a wide range of markets around where it is active.

When a user chooses to pay by bank transfer, it essentially goes through any interface used by their own bank when interacting directly with it, which is then used to make payments to the merchant’s account. Routes payments through Trustley’s network.

The system is secure like a person’s online banking interface, which will typically use two-factor authentication to complete transactions, unlike most card transactions. Burglund says that for this reason, the company has not experienced any type of breaches or fraud that you see in card payments.

In terms of Trustley’s business model, it is a customer of banks, while merchants are its customers: it charges transaction fees from merchants that use trusted networks to receive payments, and Berglund said the percentage would vary Is, but essentially less what they will pay for card-based transactions.

But because the payments are complex, this is not the whole story. In addition to working directly with merchants, Worldview also trusts with a number of third parties such as PPRO, Rapid, and others, who use these latter services through an API (rather than multiple APIs or integrations) with multiple payment options. To integrate. Their check-out stack.

And Berglund said that it looks like it could lead another new wave of customers. Banks themselves are exploring ways to provide more services to merchants who bank with them, and so the trustee is talking to some of them about the ability of the white-label version that the trustees provide so They can provide direct service.

The reason it has not been replicated is why it is difficult to build any financial service from the ground up: reliably not only a banking network, but integration around it, as well as the business of customer service payments Provides merchants around. He said that it becomes difficult to copy. “You have a big platform in the middle of this business, not unlike the platforms that exist for card payments,” he said. “It’s a big system all in one.”

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