Embedded finance continues to be a major theme in the world of fintech, with new financial services companies exploiting APIs built by others for electricity payments and other financial transactions, and more. In the latest development, global processing services — one of the big players in building and operating those APIs — is Safe A major round of funding, $300 million, which it will use to continue expanding its business globally. London-based GPS (as it’s known) already works with a number of big names in about 48 countries – its clients include Revolt, Curve, Starling Bank, Zilch, VLab Bank and Pedi – and has about 1.3 million units on its platform. Billion transactions have been processed. since 2007. Now it is looking to expand both its platform and double its geographic footprint.
The money is coming in the form of investments from two large VC/PE firms, Advent International and Viking Global Investors, who will now have a controlling stake in the company. Not disclosing GPS ratings – we’ve asked and will update if we know more. It notes that Visa, which has a Strategic investment of an undisclosed amount in October 2020, remains involved.
The deal will give GPS not only a cash infusion but a pair of partners that will help it make more strategic inroads into other markets, and potentially help bring more technology to the platform. Joan Dewar, CEO of GPS, said in a statement, “We are delighted to partner with Advent and Viking with their deep experience and track record in payments and fintech, and who share our bold vision for the next generation of global payments. Huh.” .
This is one of the major investments made in the area of embedded finance in recent months, but it is by no means the only one. Another major competitor in the same space, Rapid, also raised $300 million in August of this year. As a reference, Rapid was valued at $8.75 billion in that round. Checkout is now valued at approximately $15 billion; Railsbank also launched a big round this summer; Closing a $600 million round earlier this year, Stripe (which focuses on payments APIs but continues to diversify as a whole) is currently one of the largest privately held tech companies in the world. There is one, and there are many more in the mix.
The reason why so many of them are doing so well is twofold: First, the explosion of new, often mobile-first, financial services targeting consumers and businesses with a more seamless experience, better service, often with better rates. and a better range of options for how people operate in today’s world. Second, many of the core financial services that run in these new brands are commoditized and very difficult to actually manufacture. This has given rise to a pool of fintechs that have worked hard and now power these services for multiple clients via APIs. In theory, both the brand and the embedded finance technology provide a little win every time a customer makes a transaction.
In terms of GPS, the company has been a good player in that broad mix. In addition to having a strong list of big-name customers, it has issued nearly 190 million physical and virtual cards to date, integrated with some 95 issuer partners, gained a very strategic and important partner in the form of Visa, and Successfully expanded into Asia Pacific and the Middle East. The latter in itself is important as much fintech is regionalised.
So in addition to riding the big embedded finance trend, it’s another reason why it’s taken on this investment, and investors are interested.
“GPS provides the leading payment technology infrastructure, enabling the global fintech revolution. Their agile, flexible and cutting-edge cloud platform drives some of the most innovative use cases and enables fintech to be single-handed,” said Peter James, Director of Advent International, in a statement. Allows globalization through APIs.” Through its customer-centric innovation, GPS has quietly established a leading position in key markets around the world with an attractive, diverse and global customer base. With Viking, we look forward to supporting GPS’s leadership team to expand the business’s product offering and accelerate its international reach.