Today Modulr, a digital alternative to commercial and wholesale transaction banking, has secured around €21.3 million in growth funding to further develop its platform and expand into new products and markets.
The funding round was led by Highland Europe, a leading European growth capital firm, with participation from existing investors including scale-up specialists Frog Capital.
Modular, founded in 2015, is a new digital payment account for business. Replacing bank accounts, the Modular service also has sort codes, access to payment schemes and everything you’d expect, but claims to be faster, easier and more reliable.
Modulr is specifically targeting the €2.4 trillion incurred through administrative costs every year in the wholesale and transaction payments market – 80% of which is paid by small businesses. Modulr’s digital payments infrastructure changes this, by automating business payment flows, embedding payments into platforms and enabling businesses to build new payment products and services themselves. This allows businesses to scale quickly and efficiently, all supported by Modulr’s powerful payments platform.
In 2019, Modulr became one of the very few non-banks to gain direct access to Faster Payments and Bacs, as well as becoming a principal issuing member of Visa. Modulr, which is also backed by venture builders Blenheim Chalcot, also opened its first non-UK office in Dublin, to begin expansion into the European market. In less than four years, Modulr has scaled to process more than €28 billion worth of payments through its partner clients including Sage, Liberis, Salary Finance and Iwoca.
The new growth investment takes Modulr’s total funding received to around €60.3 million and delivers on the fintech’s commitment to match the approx. €11.3 million it was awarded from the Capability and Innovation Fund in August. The new €21.3 million will be used to develop its product and service offering, with the introduction of card issuing and deeper European payment capabilities, and enable the company to expand further into new markets.
Myles Stephenson, founder and CEO at Modulr says: “In the past year, we’ve experienced strong growth, we’ve gained direct access to key payments infrastructure and have positioned ourselves as a trusted payments partner for some of the most ambitious companies in the UK and beyond. With Highland Europe, we have a partner which can help to further fuel this momentum, investing in our infrastructure and product suite to ensure we can provide our customers with a reliable service that’s easy to access and simple to use. This is important, particularly in the face of this tough business landscape. With this new investment we’re ensuring customers’ payments infrastructure can continue to work seamlessly in the background, so they have one less thing to worry about.”
Laurence Garrett at Highland Europe says: “No-one can deny the opportunity of the business payments market, some five times the size of the opportunity presented by consumer payments, and Modulr is the leading platform in this space. We were impressed with its strong operational resilience and its proven history of sustained stable growth within the growing B2B payments industry. Myles and the team have firmly established the fintech as the go-to provider of payments services for ambitious businesses, and we look forward to fuelling this growth further.”
Mike Reid, Senior Partner at Frog Capital says: “Modulr is a breath of fresh air in the enormous Corporate Payments industry, bringing clients a major step change in efficiency, flexibility and transparency delivered through their market leading technology. This, together with their direct Bank of England access, marks them out as one of stand-out European fintech infrastructure players.”