Digital challenger bank Revolut raises $66m from Balderton, Index and Ribbit and will crowdfund more on Seedrs in latest fintech funding

Lynsey Barber
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Revolut is one of several fintechs challenging banks to raise funding this year (Source: Revolut)

Digital challenger bank Revolut has secured millions in new funding from top investors to fuel ambitious expansion plans.

The startup has raised $66m (£51m) in a series B from existing investors Balderton Capital, Index Ventures and Ribbit Capital in the latest sign of investor appetite for startups looking to take on the big banks.

It brings total funding for the challenger to $83m and the fresh cash will go towards pursuing expansion in Asia and North America and launch new products and services.

Read more: This digital challenger bank for small business has landed $14m

It has already introduced several in recent months, includiing an Amazon Prime style subscription, banking for business and partnering with other fintechs for loans. And it's taking on Transferwise by scrapping fees on transfers of up to £5,000.

It will target key markets in Europe, where it plans to hire new country managers, including Germany, France and Scandanavia.

The startup, which boasts more than 700,000 customers after two year, plans to launch personal IBAN accounts across the region so that users can pay their salaries into Revolut and will soon accept cryptocurrencies such as bitcoin and ethereum.

“Asia and North America are far from immune to hidden banking fees and dated technology. The fintech revolution has been an astounding success across Europe, and now is the time to broaden our horizon and embark on our global mission," said founder and chief executive Nikolay Storonsky.

Revolut also plans a fresh round of crowdfunding via Seedrs to raise a further $5m after a hugely popular raise on Crowdcube which saw more than £17m pledged by 10,000 wannabe investors, surging past the £1m target.

It also took on an undisclosed sum of debt financing from Triplepoint Ventures in June

Read more: Fintech startup Monese moves closer to bank territory (and profit)

“Revolut is on a mission to create a world where moving money is easy, instant, free and transparent, regardless of country or currency. It is removing barriers between people and merchants, enabling them to transact seamlessly around the world," said Index Ventures partner Martin Mignot.

"Very few founders have both the clarity of vision and the single-minded focus that Nik and his team have exhibited to date. They simply won't stop until their mission is complete.”

Things are hotting up in the digital challenger bank space, with startups stepping things up a gear in recent months in terms of getting their apps in the hands of customers and offering them more features. And investors are attracted to these fintechs wanting to disrupt traditional banking: Monzo, Monese and Tide are among the fintechs to have bagged fresh investment this year.

It's understood Tandem bank is close to securing new funding after a crackdown on outbound investment by Chinese authorities resulted in £29m in funding being pulled by the owner of House of Fraser.

And peer-to-peer lender Zopa raised £32m as it prepares to move in on challenger bank territory after applying for a banking license.

Meanwhile Fidor, a German challenger bank which launched in the UK in 2015 and was acquired by French bank BPCE last summer, has partnered with startups this side of the channel. It will offer users alternative investments via Nutmeg and Seedrs on through its finance marketplace.

Read more: Starling Bank's partnered with Vocalink for mobile payment tech

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