Finance-as-a-service (FaaS) is revolutionizing the financial industry as we know it. These days more nonbank companies are offering financial products, such as bank accounts, wallets, payments, and lending. This has led to an unmistakable opportunity, according to a recent report by Lightyear Capital. The report estimates that embedded finance will grow to nearly $230 billion (in revenue) by 2025, up from $22.5 billion this year. Now one of the companies providing those FaaS solutions has announced fresh new funds for international expansion.
London-based Railsbank is an open banking API and a banking-as-a-service (BaaS) platform that gives regulated and unregulated companies access to global banking. The company recently disclosed that it raised $70 million in the latest round of fundraising, which was led by Anthos Capital. Since being launched in 2015, the startup has quickly grown to become one of the leading BaaS players. To meet the rising demand for embedded finance, the company is understandably busy deepening its product offering, with ambitions to deliver the next wave of digital disruption to the $4 trillion U.S. credit card market. Railsbank, which last raised money with a $37 million funding round in November 2020, says it will use the latest infusion to further expand its product range including across Europe, Asia Pacific, and North America.