Open banking start-up Railsbank clinches $1.2m seed investment

Founded by Currencycloud's Nigel Verdon, Railsbank will use funding to build out its partner network of banks and fully launch its platform

Railsbank, a new financial technology start-up, has closed $1.2m in funding from seed investment firm Firestartr, alongside Kima Ventures and angel investors Peter Jackson, CEO WorldPay UK; Tim Levene of Betfair and Augmentum Capital, and Phillip Riese, former Chairman of Zopa.

Founded by Nigel Verdon, the man behind two-time Startups 100-featured Currencycloud , Railsbank operates a banking and compliance platform giving businesses access to global banking via an application programming interface (API) and a global network of partner banks.

They can then access services such as creating digital ledgers, connecting digital ledgers to real bank accounts, issuing IBANs for ledgers, receiving money, sending money, foreign exchange, direct debits, issuing cards, and managing credit.

Railsbank has yet to fully launch and previously raised an undisclosed amount of seed funding in September 2016, which saw participation from the former head of Google Wallet in Europe. This fresh funding will be used to build out the company’s partner network and take its open banking platform live in the near future.

Ultimately, Verdon and co-founder Clive Mitchell intend to give companies “access to global banking with five lines of code” in a “simple, cost-effective and compliant manner”.

Verdon commented: “We are delighted to have closed this latest round and received backing from such leading firms and figures in the investment community. It underlines the confidence we and others have in Railsbank, and our business model, and it will allow the company to continue to develop in the direction and at the pace we have planned.”

Richard Muirhead, Firestartr chairman and general partner, said: “We are very excited to welcome Verdon, Mitchell and their awesome team to the Firestartr portfolio. Most of the market is focused on PSD2 and not focused where RailsBank are, for example, building a global bank, delivered as a platform.

“We believe this gives them an advantage and look forward to working with them on their journey as they scale RailsBank from seed stage to Series A and beyond.”

Find out why Nesta’s Chris Gorst thinks open banking signals a welcome change for small businesses and why it’s time to embrace the “banking revolution” here.

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