London-based fintech startup Raylo raises €7.5 million for its subscription payment solution

Bringing the increasingly popular subscription model to retailers, London-based startup Raylo has just raised €7.5 million. The fintech firm is reimaging payment options in a way that enables people to get access to the tech they need in a sustainable way. 

With the cost of living rising across Europe, consumers are finding it more difficult to make purchases upfront and in one go. Across Europe, the crisis has fueled increased interest in alternative payment methods, and the Buy Now Pay Later and subscription models are standing out as the most popular options. As a result, innovation in fintech is accelerating with new solutions coming to the market. 

Aiming to lead the change in how products are sold and enjoyed, fintech startup Raylo has developed a platform that enables companies to embed a subscription model into payment processes. It means that consumers can access the tech they want, in a financially and environmentally responsible and sustainable way. Founded in 2019, the startup has just picked up €7.5 million in additional funding, including a strategic investment from Wayra UK, part of the global telecoms group, Telefónica. Existing investors Octopus Ventures and Macquarie also participated in the round. 

Bruno Moraes, Managing Director of Wayra UK, commented: “There is a clear shift in consumer behaviour and their preference for subscription-based payment models. There’s an appetite for more affordable options to purchase great technology and devices. The Raylo team has proven success in delivering on this consumer trend, and we look forward to helping them scale up their platform through our strategic resources and networks.”

The surge in demand for more flexible ways to pay, brought on by the rapidly increasing cost of living, has fuelled a change in consumers’ expectations.  The ‘Buy Now, Pay Later’ (BNPL) space is well known for its ‘Pay in 3’ model and is particularly popular for small and mid-sized purchases with fast fashion and beauty retailers. However, for larger ticket items such as consumer electronics, there lacks a solution to fully address consumer affordability and poor checkout conversion rates.    

This is where London-based Raylo finds its target market. By adopting Raylo Pay, retailers can add a new subscription revenue stream that increases customer conversion, while offering a more affordable and sustainable option at checkout.

The platform enables consumers to have access to the latest products via a monthly subscription that’s both more economical and sustainable. Retailers are paid upfront and in full (zero fees) for any purchases, whilst consumers pay only a fraction of the cost of the product during the subscription term. When consumers are ready to upgrade, the old products are returned and enter Raylo’s circular process of refurb and re-commerce for maximum lifespan and sustainability.

It, therefore, makes for more financial stability and flexibility for consumers, as well as making the purchase of electronic goods circular – a real win-win.  

Raylo’s retailer pipeline extends across a number of categories, including consumer electronics. Affordable Mobiles, a leading UK electronics retailer, is amongst the first to add Raylo Pay to their checkout, offering their customers 12, 24 and 36-month subscriptions across tablets, laptops and smartphones.
Raylo co-founder and CEO, Karl Gilbert, added: “We are delighted that Telefónica shares our vision of bringing our Raylo Pay solution to retailers across the UK and beyond. Subscriptions are a fundamentally better way to sell any durable product with a regular upgrade cycle – retailers  enjoy a significant conversion uplift, consumers pay a fraction of the cost each month, and we avoid the wastefulness that has been encouraged under other payment models.”