Railsbank, the banking-as-a-service, raises $ 37 million in progress funds


Railsbank, the London-based banking-as-a-service platform, has raised $ 37 million in new growth funds.

At the top are MiddleGame Ventures and Ventura Capital, both existing investors in Railsbank . Also there are Anthos Capital, Global Brain, Clocktower Technology Ventures, Moneta VC, Mitsui Fudosan and Firestartr.

Nigel Verdon, co-founder and CEO of Railsbank, tells me that the capital injection will be used to further expand the global presence of fintech and continue product development. This includes the introduction of "Credit Cards as a Service" in the US and the expansion of the product in APAC, including the Philippines, Indonesia, Malaysia, Australia and Japan. It will also double in existing markets like the UK / Europe.

Verdon is also not ruling out further M&A activities, including other strategic acquisitions following the acquisition of Wirecard in the UK.

When asked what the benefit of the Wirecard acquisition was, the Railsbank founder says it will help maintain an orderly market in the UK and Europe and protect the reputation of the fintech industry. According to Verdon, several million cardholders were able to continue using their cards immediately, "and customers were able to stay in business with minimal disruption".

He also says the acquisition brought “extremely talented and experienced employees” from Wirecard to Railsbank and ultimately gave the company “significant equity value”.

Railsbank positions itself as a “utility” on which other companies – from fintech upstarts to challenger brands to established banks looking to re-factor their technology – can build and sell various financial services or add fintech functionality to their products.

When the company closed its Series A, Verdon compared it to what Amazon did for data centers with AWS. "Railsbank is a utility for the entire financial services backend: platform, connectivity, operations, system memberships (e.g. Visa), regulation and compliance," he told me at the time. More recently – and not surprisingly given the latest fintech trends – Railsbank has also been promoting itself as an embedded finance partner.

The problem is, Railsbank's APIs are the building blocks for customers to “build pretty much any financial use case they can think of. The use cases are also diversified, with the top three cases being lending, banking and savings embedded in fintech, retail, telecom, insurance and other customer trips, ”says Verdon.

For this purpose, the Railsbank credit card as a service offer means that every company can offer a branded credit card using the infrastructure and technology of fintech. "In less than 12 weeks, we deliver a customer-branded credit card along with a user journey that is seamlessly embedded in the customer's existing user experience," explains Verdon.

"Our mission is to reinvent, unbundle and democratize access to the complex, opaque, Byzantine 70-year-old credit card market, valued at $ 4 trillion in the US alone."

Railsbank now has more than 200 employees who speak more than 40 languages. It has offices in 11 locations: Santa Monica (USA), Singapore, Vilnius (Lithuania), Munich (Germany), Newcastle (Great Britain), London, Manila (Philippines), Kuala Lumpur (Malaysia), Melbourne (Australia), Vietnam and Sri Lanka.