Fintech
Q1 202408.01.2024

Digital Banking

Picture of Daria Dmytrenko

Daria Dmytrenko

at Sifted

2023 wasn’t pretty for the digital banking sector. The $1.3bn raised by European startups was the lowest figure since 2016 and deal count fell by 62% on 2022 — a trend widespread across fintech. Only two rounds upwards of $100m were completed: Atom Bank’s £100m downround in November (taking its valuation from £435m to £362m) and bunq’s $111m Series B at a flat valuation.

The latter recently unveiled its new GenAI-driven chatbox, where users can gain personalised advice on spending, saving and financial planning. Digital banks are looking to — with the help of BaaS startups — automate backend processes and liberate personnel from routine tasks, by optimising operations through chatbots, virtual assistants, and expediting lengthy loan approval processes with advanced credit scoring and risk assessments. Fortifying security is also on the agenda, with banks having no choice but to embrace multi-factor authentication, biometric features and real-time monitoring against cyber threats and fraud.

Finally, the announcement of HSBC’s cross-border payments app ‘Zing’ — developed in stealth — has unnerved the sector, and with uncertainty persisting around interest rates, it means the current crop of digital banks and BaaS infrastructure startups have a lot to contend with.

20 most promising early-stage digital banking startups

  • Weavr logo

    Sifted score

    8.18
    -

    Weavr

    Embeddable financial products for digital businesses and banks

    • Strong investor(s)
    • Serial founder(s)
    • Year founded

      2018

    • HQ

      London, United Kingdom

    • Latest round

      Series A
      43.9m

    • Total funding

      49.2m

  • HUBUC logo

    Sifted score

    7.83
    -

    HUBUC

    Card issuance and processing platform

    • Strong investor(s)
    • Serial founder(s)
    • Year founded

      2019

    • HQ

      Barcelona, Spain

    • Latest round

      Seed
      9.1m

    • Total funding

      9.4m

  • Numeral logo

    Sifted score

    7.65
    -

    Numeral

    Banking and payments infrastructure

    • Strong investor(s)
    • Year founded

      2021

    • HQ

      Paris, France

    • Latest round

      Seed
      13m

    • Total funding

      13m

  • Currensea logo

    Sifted score

    7.56
    -

    Currensea

    Provider of direct debit cards for use abroad

    • Strong investor(s)
    • Serial founder(s)
    • Year founded

      2018

    • HQ

      London, United Kingdom

    • Latest round

      Seed
      5.2m

    • Total funding

      13.3m

  • Rocker (formerly Bynk) logo

    Sifted score

    7.4
    -

    Rocker (formerly Bynk)

    Personal finance and banking app

    • Serial founder(s)
    • Year founded

      2016

    • HQ

      Stockholms kommun, Sweden

    • Latest round

      Early VC
      55.0m

    • Total funding

      76.5m

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