Via Kristy Dorsey
PayPal Ventures has received a £ 9 million investment from London-based fintech company Modulr, which employs the majority of its 200 employees at its Edinburgh development center, to create more products, increase its team and expand its customer base.
It is the second effective funding round this year for the company and takes to £ 63.3 million the total sum raised since Modulr was formed in 2016. Other sponsors include Highland Europe, Frog Capital and Blenheim Chalcot, as well as a Capability and Innovation Fund grant of £ 10 million.
The latest influx of cash would contribute to the development of 50 new positions at the company’s Edinburgh, London and Dublin offices. Of the current workforce, about 120 are based in the Scottish capital.
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The API platform of Modulr is an alternative to conventional wholesale and business payment services and is seeing rising demand as companies during the Covid pandemic have progressively switched to digital transactions. Company and software platforms in the lending, finance, financial technology, travel and jobs sectors are using it to incorporate digital payments into their existing platforms.
“More and more digital businesses want to embed payments into their existing user experience, but either don’t have the expertise or resources. Modulr is well positioned to be an enabler of this trend and will undoubtedly expand end users’ access to fast, reliable and secure financial services.”More and more digital companies want to implement payments into their existing user experience, but either do not have the expertise or resources. Modulr is well positioned to be an enabler of this trend and will undoubtedly expand access to fast, reliable and secure financial services for end users.
Last year, Modulr became a full participant in the programs for BACS and Quicker Payments, allowing the Bank of England to process and retain funds. In addition, Modulr has direct access to Visa and Mastercard and has recently secured an e-money license from the Central Bank of Ireland.
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The contract with PayPal Projects marks a “significant milestone.” Chief Executive Myles Stephenson said.
“Modulr lowers the barriers to bringing payments into a platform, creating endless new opportunities for our customers while allowing them to focus on their core competencies,” he said. “PayPal Ventures’ investment strengthens our ability to execute on this vision.”
In a financing round led by the rising equity firm Highland Europe, Modulr raised £ 18.9 million in May this year. Additional funding was also provided by established investors such as Frog Capital, a scale-up specialist, and investment constructors Blenheim Chalcot.
Via its affiliate clients, including Sage, Liberis, Salary Financial and Iwoca, Modulr processes more than £ 25 billion worth of payments.
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More than $120 trillion (£91 trillion) is transported annually by the global wholesale and transactional payments industry, five times greater than the consumer market. In particular, Modulr is targeting $2.7 trillion in operating costs, 80% of which are borne by small companies.
In 2018, the company opened its Edinburgh headquarters, creating 18 jobs initially. After studying different technology hubs around Europe, Modulr selected Edinburgh after finding London a challenging place to develop a relatively small business.
At the time, Mr. Stephenson cited as the basis for selecting the Scottish capital the “excellent” talent pool of Edinburgh, robust financial services sector and links to industry and government funding.
After Frog Capital initially invested £14 million in the venture, Modulr opened its Dublin office in 2019. The Irish office serves as a springboard to the continent, with a license there that enables the company to do business anywhere in Europe.