GoCardless is on a mission to rival credit and debit cards. So, it has created a global bank debit network with the aim of taking the pain out of getting paid for businesses with recurring revenue. And now it has joined the ranks of the unicorns, reports Douglas Blakey

Specifically, GoCardless announced on 8 February that it has secured a Series G funding round of $312m at a valuation of $2.1bn. Siamac Rezaiezadeh, Director of Product Marketing at GoCardless says that the latest funding will allow GoCardless to accelerate its growing footprint in the open banking space through both product and geographical expansion. The aim: to become the world’s leading network for direct bank payments.

The round is led by Permira, notable for its stable of investments in the likes of Klarna, Clearwater Analytics and Carta.

BlackRock Private Equity Partners also joins this round as a new investor.

Instant Bank Pay to launch in Germany, rest of Europe will follow

Rezaiezadeh tells EPI: “We are super pleased about the fund raising and what it means. It allows us to accelerate growing our footprint in open banking and account to account payments around the world. That is key: product and geographic expansion.

“We are just about to roll out Instant Bank Pay into Germany. And then we think about how we roll that out across the rest of Europe. It also enables is to expand our verification feature, also powered by open banking called verified mandate.

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“We launched that first into the US last year. This year, that launches in the UK, France and Germany, in the first half. Really excitingly, it enables us to expand Instant Bank Pay to take care of recurring payments, leveraging variable recurring payments in the UK which we will launch as soon as it is available.

“And it enables us to integrate the new payments platform Pay2 framework in Australia into our platform in time for the regulated launch in the summer this year.”

The GoCardless pitch to business is simple: more visibility over payments and time saved on tasks such as payment reconciliation. It has built a platform designed and optimised for taking invoice, subscription, membership and instalment payments.

It partners with over 150 billing and subscription software partners including Xero, Sage, QuickBooks, Zuora and Salesforce.

GoCardless’ valuation has more than doubled since its last funding round in December 2020.

Since then, it is ramping up its investment in open banking product development and rolled out Instant Bank Pay.

Instant Bank Pay: a new way to take one-off bank-to-bank payments instantly

With Instant Bank Pay, users can take instant, one-off bank-to-bank payments from new and existing customers. At the same time, GoCardless clients still reap the benefits of bank debit for recurring payments.

85% of recurring revenue businesses need to collect one-off payments, in addition to their typical subscription, invoice or instalment payments.

Bank debit works well for recurring payments but is not suitable for the times users need to take a one-off payment. This causes businesses to turn to other forms of payment like cards and bank transfers. That does not benefit GoCardless, hence the launch of Instant Bank Pay.

Instant Bank Pay in three steps:

  • Send a payment requestAdd Instant Bank Pay to the business’ checkout, or send the customer a link requesting payment;
  • Customer authorises paymentGoCardless connects the customer to their bank and they authorise the payment, and
  • Payment completed. Once payment is made, the GoCardless user and the customer both receive an instant confirmation.

GoCardless currently processes more than $25bn in transactions a year for over 70,000 businesses around the world.