As today’s shoppers are increasingly reliant on plastic rather than cash, small businesses without the means to process card payments were losing customers.
Noticing the trend, Sweden-founded iZettle introduced a card reader that accepts transactions via smartphones, offering a new revenue stream for small business owners and a better customer experience for the consumer.
It’s comparable to US leader Square, which was launched by Twitter founder Jack Dorsey, but has a European focus and the company entered the UK in 2012. Since then, iZettle’s tech has developed significantly with chip and PIN support, followed up by integration with Apple Pay and contactless.
The firm has now closed a 60m Series D investment from previous investors Intel Capital and Zouk Capital. It will see the firm expand its iZettle Advance lending service across the European markets it serves to signal a milestone in the company’s ambition to broaden its product and service offering .
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The lending scheme will provide pre-assessed small business owners with an advance on sales, depositing the temporary loan within days. The money will then be paid back gradually as sales roll in, with the amount payable varying based on the company’s cashflow.
“We have aimed to build a financing service that’s completely tailored to the needs of small businesses. The service allows for small businesses to make the necessary investments in their operations, on their own terms and with minimal administration,” said Carl-Richard Hggman, iZettle’s chief risk officer.
Demonstrating the increased potential of the mobile market, iZettle rival SumUp has also closed an investment round.
It secured 10m from BBVA Ventures, Groupon and American Express, and plans to use the funds to expand into two new countries this year, which will total 15 served. The firm also aims to develop new services, including support of contactless payments.
Daniel Klein, CEO of SumUp, said: “With strong partners such as BBVA Ventures, Groupon and American Express, we are now better equipped than ever to execute on our vision of empowering small businesses all over the world by radically simplifying payments.
“We can’t wait to offer our solution to even more merchants soon by launching the in new markets later this year. We are delighted to have received two major investments within less than two months.