GoCardless secures $312m to accelerate growth in open banking

GoCardless, a leading fintech in direct bank payment solutions, has secured $312 million in a Series G funding round, making it the latest European and UK tech unicorn valued at $2.1 billion.

In the last year, the steady beat of payments change has started to feel like a drumroll. The pace of both innovation and investment in payments have radically accelerated.
Dr. Elisha Phelan

The investment is led by a British investment firm Permira, which provided backing to a number of payments and financial software businesses including Klarna, Clearwater Analytics and Carta. New investor BlackRock Private Equity Partners also joined the round.

Commenting on the announcement, Hiroki Takeuchi, co-founder and CEO of GoCardless, said: “I am delighted to have partners like Permira and BlackRock Private Equity Partners on board, with their global footprint and strong expertise in tech, to support us in building a direct bank payment network that lets payments flow freely, without cards, expiration dates or extra costs.”

The funding will enable GoCardless to accelerate its growing footprint in the open banking space through both product and geographical expansion as it targets becoming the world’s leading network for direct bank payments.

“The rise of open banking presents a once-in-a-generation shift, one that will change the way payments happen all over the world,” said Takeuchi.

Alberto Riva, Principal at Permira, added: “We believe GoCardless is uniquely positioned to become a global champion in account-to-account payments through leveraging open banking. We are thrilled to back Hiroki and his excellent team to continue innovating and offering best-in-class solutions that are cheaper, faster and a more secure way of collecting payments globally.”

GoCardless accelerated its investment in open banking product development and launched Instant Bank Pay, a new way to collect one-off bank-to-bank payments using open banking. Since then, it has already helped thousands of merchants in the UK and Europe process millions of dollars’ worth of one-time payments.

Klarna recently selected GoCardless to offer bank debit payments to its more than 21 million customers in the US, leveraging the payments fintech’s expertise in account-to-account payments as it expands in the market. In addition, PayPal and GoCardless have signed a strategic agreement which will see the latter become a direct debit partner for the e-commerce payments company. PayPal enterprise merchants will soon have the ability to offer their customers additional bank payment options as consumers increasingly seek choice at checkout.

With the round, GoCardless will also add further technology and payments expertise to its Board of Directors with Michael Rouse, former Chief Commercial Officer at Klarna joining, and Koen Köppen, Chief Technology Officer at Klarna and Board Member of Mollie, joining as an independent director.

J.P. Morgan Securities PLC acted as Sole Placement Agent on this fundraise. Goldman Sachs International acted as financial adviser to Permira.

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