Berlin-based B2B buy now, pay later (BNPL) fintech firm Mondu has raised $42m in a fresh funding round to accelerate its European expansion.

The Series A financing round was led by US-based Valar Ventures with participation from existing backers and angel investors, including senior executives from Klarna, Zalando and SumUp.

Founded in last August by Philipp Povel, Malte Huffmann and Gil Danziger, Mondu provides a BNPL offering that provides online merchants and marketplaces flexible payment options at the checkout.

When a business customer opts for one of its payment methods, the firm will coordinate the processing of the payments as well as associated services with its full-service solution.

Last month, Mondu signed a Banking-as-a-Service (BaaS) partnership with Raisin Bank to roll out an additional option for instalment payments.

Since its launch last year, the firm has expanded its team to more than 100 employees.

The fresh capital infusion will allow Mondu to expand its offerings into Australia and other European countries later this year.

Mondu co-founder and co-CEO Philipp Povel said: “While B2B BNPL is behind the consumer BNPL market, we believe there is a $200bn opportunity just in Europe and the US, which is bigger than the global consumer BNPL market.

“This Series A and the backing of our European and US investors will support us to rapidly scale our product and customer reach ahead of further expansion in Europe later this year.”

Recently, European BNPL player Scalapay bagged a $27m investment from Poste Italiane to fund product development, brand building and expand its team.