European open banking platform Tink, which last month named NatWest as its first UK banking partner, confirmed that PayPal has become a strategic investor.
In February this year, Tink raised a total of €56 million in new funding and announced it had gone live in five new European markets, enabling developers in the Nordics, the UK, Austria, Germany, Belgium, and Spain to access financial data via its account aggregation application programming interface (API).
New investor PayPal joins Tink’s existing backers, which include US-based Insight Venture Partners, Sunstone Capital (recently renamed Heartcore Capital), SEB, Nordea Ventures and ABN AMRO Digital Impact Fund. Individual backers include Christian Clausen, former chairman of the European Banking Federation, and Nikolay Storonsky, co-founder of banking app Revolut.
In addition to investing, PayPal has agreed to partner with Tink to leverage its account aggregation technology to “improve product experiences” for PayPal customers. Although not specified, potential use cases include utilising open banking for easier and more secure onboarding, checking the bank balance prior to initiating a debit card payment or using personal transaction history in relation to PayPal Credit.
“Open banking is transforming financial services, allowing customers to more easily move and manage their money,” said Jennifer Marriner, PayPal’s VP of global markets and partnerships. “Tink has developed the infrastructure and data services for this new financial world and we’re excited to work together to continue to democratise financial services.”
Tink initially launched in Sweden in 2013 as a consumer-facing finance app focused on bank account aggregation and has since expanded its offering to provide banks and other financial service providers that want to optimise the business opportunities opened up by Europe’s Payment Services Directive (PSD2) and the new era of open banking.
Through APIs, Tink provides four pillars of technology: account aggregation; payment initiation; personal finance management; and data enrichment. These can be used by third parties either for their own standalone apps or integrated into existing banking applications.
TrueLayer attracts $35m
In separate funding news, London-based TrueLayer has secured US$35 million in funding from Chinese technology giant Tencent Holdings and Singapore government-owned fund Temasek, boosting the total amount that it has attracted to date to $47 million.
A three-year old fintech start-up, TruLayer sells open banking software enabling users to share or aggregate their financial information from different providers.
The company’s UK customers include the new digital-only bank Monzo and peer-to-peer (P2P) lender Zopa. TrueLayer also has a presence in Germany, France, Italy and Spain and is expected to use the funding to expand across Europe, with a goal of connecting most of the continent’s banks by the end of the year.
Other UK fintechs to have secured funding include supply chain finance (SCF) specialist Greensill, which last month attracted US$800 million from SoftBank Vision Fund and WorldRemit, a London-based technology company that helps expatriates and migrant workers send remittances back to their home countries, which has raised US$175 million in new funding.
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