GoCardless gets AUD $437m to meet open banking and PayTo plans

Hiroki Takeuchi, co-founder and Chief Executive Officer of GoCardless

GoCardless, a leading fintech in direct bank payment solutions, announced that it has secured a Series G funding round of AUD $437 million (USD $312 million), making it the latest European and United Kingdom tech unicorn at a valuation of AUD $2.9 billion.

The investment is led by Permira’s Growth Opportunities fund, which brings significant experience in backing payment platforms including Klarna, Clearwater Analytics and Carta.

New investor BlackRock Private Equity Partners also joined the round. The funding will allow GoCardless to accelerate its footprint in the open banking space through both product and physical expansion as it targets becoming a global leading network for direct bank payments.

GoCardless to launch PayTo

In Australia, GoCardless is committed to having its platform ready for the regulated launch of PayTo in the middle of 2022, as part of a competitive strategy to beat the banks to market and provide a faster, cheaper and more secure alternative to credit cards.

Merchants who use PayTo through GoCardless will also be able to access the company’s global direct debit network. This in turn will enable them to create sophisticated payment strategies, optimising for instant authentication, cost or experience.

Luke Fossett, Director ANZ at GoCardless, said, “We see PayTo as a true disruptor, an example of technology that will quickly scale and challenge the dominance of cards.”

“Not only does it offer merchants instant account-to-account payments with more safety against fraud and failed payments, PayTo gives payers more control, visibility, and security.”

“We’re excited to launch PayTo with our first customers, BizCover and Simply Energy, and look forward to helping many others offer this powerful payment option to their clients.”

GoCardless market reach

GoCardless processes more than $25bn in transactions per year and serves over 70,000 businesses around the world, including DocuSign, Klarna, TripAdvisor and Epson. Since its last funding round in December 2020, the company’s valuation has more than doubled.

It’s headcount has grown by 85%. GoCardless accelerated its investment in open banking product development and launched Instant Bank Pay, a 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 over 21m clients in the US, leveraging GoCardless’ expertise in account-to-account payments as it expands.

PayPal and GoCardless have signed a strategic agreement which will see GoCardless become a Direct Debit partner for PayPal. PayPal merchants will soon have the ability to offer their clients additional bank payment options as consumers increasingly seek choice at checkout.

GoCardless’ strategic partnerships

Hiroki Takeuchi, co-founder and CEO of GoCardless, said, “The rise of open banking presents a rare generation shift, one that will change the way payments happen all over the world.”

“I am delighted to have partners like Permira and BlackRock Private Equity Partners aboard, with their 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. I look forward to working with them and our new board members to accelerate the growth of GoCardless.”

Alberto Riva, Principal at Permira, added, “We believe GoCardless is uniquely positioned to become a leader in account-to-account payments through leveraging open banking.”

“We are thrilled to back Hiroki and his team to continue innovating and offering best-in-class solutions that are cheaper, faster and a more secure way of collecting payments globally.”

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, CTO at Klarna and Board Member of Mollie, joining as an independent director.

As GoCardless builds on its decade-long experience in direct bank payments, the company will broaden its focus to enable both recurring and one-time payments. It will also open its ‘bank pay’ network to other payment service providers who want to tap into its technology.

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

About GoCardless

GoCardless is a global leader in direct bank payment, making it easy to collect recurring and one-off payments directly from clients’ bank accounts through direct debit and open banking.

The GoCardless global payments technology platform take the pain out of getting paid for 70,000 businesses worldwide, from multinational corporations to small businesses. Each year GoCardless processes over US$25 billion of payments across more than 30 countries.

GoCardless is headquartered in the UK, with additional offices in Australia, France, Germany and the United States. Please visit www.gocardless.com and follow on Twitter @GoCardless.