We’ve raised $95million to accelerate our investment in open banking
By Hiroki TakeuchiDec 20202 min read
2020 has been a difficult year for everyone, both personally and professionally, and we’ve certainly had to make some tough decisions as a business along the way. So being able to end the year with the news that we have just completed a US$95million funding round is hugely exciting, not just for the GoCardless team, but for our customers and partners too.
Firstly, it’s a great testament to the strength and resilience of our business during the most challenging economic period that we’ve experienced since launching GoCardless back in 2011. We’re proud to have been able to support our customers through these uncertain times, and to have welcomed many new customers who have helped us to drive strong growth during a very challenging year. We’ve also expanded our partner ecosystem, adding new partners and strengthening relationships with our existing partners.
So what difference will this funding actually make to our customers at the end of the day?
At GoCardless, we’ve always believed that bank-to-bank methods are the best way to collect recurring payments. We’ve built the world’s first global network for recurring payments from the ground up using bank debit, making it easy for merchants to get paid by pulling funds directly from the bank accounts of customers across 30+ countries. But bank debits aren’t the only type of bank-to-bank payments. We’ve never seen ourselves as “just” a bank debit company.
We’ve been tracking the development and launch of open banking initiatives around the world from the beginning. And we’ve been getting directly involved. For example, we collected the first ever live Variable Recurring Payments with Open Banking in the UK back in 2019.
However, like almost all trends in the world of payments, it’s taken time for this new technology to develop and gain traction. We’ve waited until we felt we could reach the highest standard of user experience in the products we offer our customers. Now it’s time to bring open banking to the world of recurring payments.
This funding will accelerate our open banking strategy, combining bank debit with open banking for the ultimate recurring payments experience. Our existing customers will see large and small changes to the product over time. One of the more dramatic changes will be to speed up cash flow for the first payment in a recurring relationship - cutting anywhere from one to five or more days off the wait to get paid for the first time.
We’re also excited that the combination of bank debit and open banking makes bank-to-bank a powerful alternative to cards in a much wider range of situations. Validating the bank account data or collecting an initial payment through open banking takes away uncertainty and risk, which often prevents bank debit being used to buy from online marketplaces or order taxis. In these situations, GoCardless will represent a low-cost alternative to cards that also offers significantly lower payment failures and churn.
I’ve always believed that payments were broken, and we’ve come a long way in fixing recurring payments for our customers. When you combine what we’ve already built with the potential of open banking, I couldn’t be more excited about how we’re going to change payments for the better.
I’m delighted to be able to cap off what has been a challenging year on such a positive note. We’re thrilled to welcome Matt Harris and the Bain Capital Ventures team to join us on the next chapter of our journey. And I’d like to extend a huge thank you to our customers, our partners, our investors and the entire GoCardless team for getting us to where we are today.