TransferWise Becomes Largest Fintech in Europe After Latest Investment

Europe has a new Fintech Fintech Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Financial Technology (fintech) is defined as ay technology that is geared towards automating and enhancing the delivery and application of financial services. The origin of the term fintechs can be traced back to the 1990s where it was primarily used as a back-end system technology for renowned financial institutions. However, it has since grown outside the business sector with an increased focus upon consumer services.What Purpose Do Fintechs Serve?The main purpose of fintechs would be to suppl Read this Term leader as of today with TransferWise assuming this mantle and boasting a valuation of $3.5 billion. The rise in fortunes for the money transfer company caps off a string of investments and deals that have placed it amongst leading venues on the continent, per a CNBC report.

TransferWise is a UK-based money transfer service. Headquartered in London, the company has around 1,600 employees and is still growing.

However, following a series of fresh investment rounds and company initiatives, TransferWise is starting to shake up the status quo, rivaling even Western Union and MoneyGram.

Secondary sale boosts valuation

The latest boost to TransferWise’s valuation has been driven by investment stakes in a secondary share sale. This included moves from several early-stage investors.

By extension, TransferWise has also sought to become more competitive amongst its global clients by lowering its fees and also retooling its entire platform.

The move has helped attract new client, which now numbers over 5 million, including over £4 billion ($5.1 billion) in processed transactions every month.

“Eight years ago we had a dream, and in a way the whole world was against us. And we’ve been able to step by step build the business and also change the environment around us to be much more consumer friendly,” explained TransferWise co-Founder and Chairman, Taavet Hinrikus in a recent interview.

Indeed, the secondary sale has garnered $292 million after employees and early investors were given the chance to sell a portion of their stake.

Notable players in the sale included European private equity group, Vitruvian Partners as well as US investment firms Lone Pine Capital and Lead Edge Capital.

Meanwhile, early investors Andreessen Horowitz and Baillie Gifford also strengthened their respective holdings in the company, while funds managed by BlackRock also contributed to the round.

According to Mr. Hinrikus, “We have been a profitable company for the past two years, we have a significant amount of cash sitting on our balance sheet. The company does not need any cash.”

TransferWise in holding pattern on IPO plan

When approached about the prospect of going public however, the TransferWise executive took a more cautionary tone. “While we believe we’ll be a public company eventually, that doesn’t help us do what we want to do in the next couple of years,” he explained.

For now, TransferWise is continuing to prioritize its growth. This was reflective in its strategy to increase its personnel, citing over 750 new hires over the next year. Of note, TransferWise had booked a net profit of £6.2 million ($7.9 million) for the fiscal year ending March 2018.

Having just surpassed British digital lender OakNorth as the largest fintech in Europe, TransferWise should be a name to watch in the Payments Payments One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl One of the bases of mediums of exchange in the modern world, a payment constitutes the transfer of a legal currency or equivalent from one party in exchange for goods or services to another entity. The payments industry has become a fixture of modern commerce, though the players involved and means of exchange have dramatically shifted over time.In particular, a party making a payment is referred to as a payer, with the payee reflecting the individual or entity receiving the payment. Most commonl Read this Term space.