On January 6, an Accounts Payable (AP) Payments-as-a-Service company, Finexio announced that it completed an oversubscribed $10 million funding round led by Mendon venture partners, Patriot Financial Partners, among others. The fresh funding gives Finexio the capital it requires to meet the demand for digital AP business-to-business (B2B ) payment services. The funding would enable Finexio to grow its payments-as-a-service business to meet the needs of financial institutions and software companies globally.
The new investor, Mendon Ventures BankTech Fund, bankrolled $1 million and topped up the financing round to a total of $10 million. Additionally, Patriot Financial Partners offered additional funding to the round after serving as a lead investor for Finexio in the past.
In August, Finexio raised an oversubscribed $8 million funding round in order to, expand its leadership team, board new AP and procurement software distribution partners and accelerate growth in key industry verticals, including manufacturing, healthcare, hospitality and higher education.
Ernest Rolfson, the Founder and CEO of Finexio, stated: "Our 'Payments as a Service' platform allows banks to facilitate rich, personalized buyers and supplier interactions, more meaningful virtual card spend take rates and more payment methods like international and supply chain finance than anything else out there. Finexio's easily integrated payments solution and unique service culture make us highly attractive to financial institutions desiring deep differentiation to compete, win and retain corporate treasury customers that generate fee income and enable more loan and deposit generation. We're excited to continue supporting banks in their efforts to provide the best modern treasury experience possible for their customers."
How COVID-19 Influenced the Demand of Digital AP Processes
The efforts by Finexio come at a time when demand for AP and payment automation has significantly increased, thanks to the Covid-19 pandemic. Before the pandemic hit the world, most companies had not automated their accounts payable processes. But, that changed the moment the pandemic took effect and forced organizations to confront the way they run their businesses if their employees could not travel to or be at the office. Financial professionals had to examine their manual processes and ask themselves how their firms could better handle payments amidst a pandemic. The answer they found was to automate their accounts payable processes so that approvals could be managed more efficiently and payments could be issued electronically by virtual cards, ACH and other means. Before the pandemic started, several businesses resisted the digital transformation. Many CEOs and CFOs simply wanted to physically sign off on checks and keep processes the way they were. But, the pandemic forced such businesses to put an end to their paper-based system. The Coronavirus crisis prompted 65% of organizations to shift from paper payments to electronic formats. Moreover, 38% of organizations have implemented changes in their internal check issuance procedures.
