B2B Payments

Open Banking Entices SMB Lender Investly To Go After Funding

Alternative lending platform Investly has announced plans to raise new funds and take advantage of the U.K.’s new Open Banking regulations, according to Peer2Peer Finance News reports Monday (Jan. 29).

The company, which provides a small and medium-sized business (SMB) invoice financing platform, aims to raise more than $700,000 via fundraising platform Seedrs. Investly is based in the U.K. and Estonia, and said the funding will help the company grow and embrace Open Banking under the EU’s PSD2 rules. Those regulations promote secure data sharing between FinTechs and traditional financial institutions (FIs).

“The PSD2 framework creates an exceptional opportunity and environment for cooperation between FinTechs and banks,” the company’s chief executive Siim Maivel said in a statement. “This is a new era for banks, so they’re interested in developing strategic partners in every possible business niche to ensure they maintain their place in the new supply chain. Our aim is to become one of these invaluable partners, which would enable us to significantly increase our business volumes whilst providing their [SMB] customers a flexible product within their bank.”

Investly is ready to deploy technology to integrate with the U.K.’s top five largest banks: Barclays, HSBC, Lloyds, Royal Bank of Scotland (RBS) and Santander. It is said to be in discussions to integrate with top Nordic banks, too, which can use the Investly platform to finance SMB invoices. The company is one of 20 startups selected by Nesta for its Open Up Challenge, which encouraged FinTechs to develop new financial services solutions under Open Banking.

While FinTechs are eagerly embracing Open Banking and PSD2, several major financial institutions have missed key deadlines to comply with the regulations. Several FIs said last month that they have been granted deadline extensions by the U.K. Competition and Markets Authority (CMA) to develop and deploy their application program interfaces (APIs) that facilitate data sharing, including Barclays, Santander and RBS.



The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.