July 12, 2019
It’s been over a decade since the infamous financial crisis. That terrible period when fiscal growth took a hit across the world. 2009 was the first year when global GDP contracted in real terms, with the ensuing recession estimated at over $10 trillion. Industries from around the globe were under the scanner, especially the banking industry. But as the saying goes, when the going gets tough, the tough get going!
Deloitte notes that the global banking system is, today, bigger and more profitable than it previously was. Assets reached $124 trillion in 2018, with return on assets being 0.9%. Having said this, although we’ve witnessed recovery in banking globally, the journey has not been uniform - some players moved ahead faster than the others. While many US and Asian banks have taken resilient strides ahead, their European counterparts still lag behind, to an extent. In Europe, during the crisis, many banks were bailed out by their respective countries’ governments. Some, that were not so lucky, had to shut down or shrink their businesses. Research from 2018 shows that “European banks still struggle just to get in sight of their pre-crisis records”.
Apart from building core capital, reducing bad loans and strengthening balance sheets, European Banks leverage a range of technologies to help strengthen and improve their respective positions. Some opt to develop banking technology in-house, while others look to banking technology service provider startups. As a study shows, “FinTechs are increasingly no longer seen as scrappy adversaries—collaboration with incumbents is more the norm.” For instance, Deutsche Bank brought together its clients to understand technology solution requirements. Following this, the bank collaborated with FinTechs to address their needs. Other banks are hosting accelerator programmes to engage with the FinTech and Banking Tech startup community through formal accelerators or incubators. Moreover, BankingTech was third in the list of segments with the highest VC funding in June 2019. The startups in this space raised $448.6 million across 12 funding deals.
While the European banking industry still needs a push from multiple fronts, BankingTech solution providers have the potential to improve the overall picture. They assist existing banks to reduce costs, improve customer experience, and make internal processes more efficient. Against this backdrop, in today’s story, MEDICI brings you some interesting, high-impact BankingTech startups headquartered in Europe:Raisin, founded in 2013, is an online marketplace for savings and investments. It enables customers to conveniently access partner banks across Europe, and secure better interest rates. The platform has 165,000+ customers and deposits worth over €11 billion invested via the platform. The startup is headquartered in Germany, and has raised $200 million in total funding. Deposit Solutions, founded in 2011, is a financial services firm. It is revolutionizing the value chain for savers and banks. It is an open architecture platform that allows banks to gather retail deposits onto their home balance sheet, without requiring a proprietary local retail infrastructure. The startup is headquartered in Germany, and has raised $133 million in total funding. 10x Banking, founded in 2016, is a cloud-native technology platform that helps client banks engage with customers. It enables customers to manage their money better, ensuring data security and personalized experiences. The company also helps client banks to use AI/ML technology to deliver insights and solutions. The startup is headquartered in the UK, and has raised $64.81 million in total funding. Truelayer, founded in 2016, provides a developer platform that enables FinTech startups to access bank APIs. It helps startups and app developers innovate in the financial services space by helping them access the banking infrastructure. The TrueLayer developer platform currently supports features like account verification, KYC processes, accessing transactional data for account aggregation, credit scoring, and risk assessment. The startup is headquartered in the UK, and has raised $47 million in total funding. Mambu, founded in 2011, enables banking providers to create, launch and service loan and deposit products through its cloud banking platform. The company accelerates time to market for new consumer and SME banking products via innovative channels. The startup is headquartered in Germany, and has raised $47 million in total funding. Treasury Intelligence Solutions, founded in 2010, is a cloud-based SaaS platform. It provides bank account management, payments, business discovery, cash flow, ERP integration, and certification solutions for treasurers, CFOs, and firms in the accountancy and the IT industry. The startup is headquartered in Germany, and has received $19 million in total funding. TradeIX, founded in 2016, is an open platform powered by blockchain and distributed ledger technology. It assists banks, asset managers, B2B networks and value-added service providers to address issues in trade finance, reforming the antiquated methods of sharing and storing data. The startup is headquartered in the UK, and has received $16 million in total funding. Leveris, founded in 2014, is a software company providing the banking-as-a-platform solution for traditional banks, new market entrants, and other consumer brands that wish to enter the banking and lending space. The company offers two integrated products - a full suite of an end-to-end digital retail bank, and a full spectrum lending solution. The startup is headquartered in Ireland, and has received 15.9 million euros in total funding. Figo, founded in 2012, enables developers, startups and even banks to connect to every financial service provider through API. The partners can access every kind of bank account (current, savings, loans, securities), credit card, eWallet and other financial services through a single REST-API. The startup is headquartered in Germany, and has raised more than $11.3 million in total funding. Five Degrees, founded in 2009, is a core banking technology provider, offering a digital banking platform along with wealth management and financial inclusion solutions. Its clients include retail banks, asset managers, online savings banks and greenfield operations in the financial services industry. Its open services platform integrates with any external service like KYC checks, passport validation, PFM, etc. The startup is headquartered in the Netherlands, and has raised $10.6 million in total funding. Cobase, founded in 2017, provides a multi-banking platform that directly connects the existing networks of banks and users. Additionally, it includes features like a Central Payment Hub, and various Cash Management and Treasury Management modules. Currently, it is developing a Robo Assistant module that will help users monitor balances and transactions, and will perform automatic tasks like accounts sweeping or funding. The startup is headquartered in the Netherlands, and has raised $8.8 million in total funding. Traydstream, founded in 2015, is a cloud-based platform that helps in automating, digitizing, and managing trade. It is a player in trade finance technology that builds software to transform the previously inefficient and protracted methods of trade finance processing, which, in turn, facilitates smarter transactions. The startup is headquartered in the UK, and has raised $6 million in total funding. TreasuryXpress, founded in 2007, was earlier known as Box & Automation Solutions. It has developed its system through a fusion between ASP concepts and those related to the customer service bureau. It provides efficient services in cash management and financial control, with no need whatsoever for software acquisition. The startup is headquartered in France, and has raised $5 million in total funding. Railsbank, founded in 2015, offers a banking and compliance platform. It allows users to connect their companies with Railsbank’s partner network, including banks, financial services, and compliance providers. It also helps companies, including FinTechs that have API-related global banking requirement. The startup is headquartered in the UK, and has raised $1.2 million in total funding.