Iceland-born startup Meniga is a digital banking platform that helps banks, businesses, and individuals manage their financial data. Currently headquartered in London, the company was founded in direct response to Iceland’s financial crisis in 2008 and is now keen to boost digital banking across Europe.
In a recent development, the fintech company has raised €10M in a fresh round of funding led by new and existing investors. The round was led by institutional investors, Velocity Capital Fintech Ventures, and Frumtak Ventures. Other participants in the round include Industrifonden, the UK Government’s Future Fund, and existing customers UniCredit, Swedbank, Groupe BPCE, and Íslandsbanki.
How was Meniga founded?
Speaking about how Meniga was founded, Georg Ludviksson – CEO & co-founder of Meniga, told Silicon Canals in an exclusive interview, that “Having studied computer and electrical engineering, I’ve always had a passion for software development and I actually started two software companies, Dimon Software and UpDown.com, prior to founding Meniga. In tandem, I’d built up a strong interest in fintech in particular, and I actually had the idea of starting my own personal finance management company for quite some time.”
It was during the financial crash hit in 2008, that led Ludviksson to believe he finally has the opportunity to start his own fintech company.
He further adds, “With Iceland particularly hard hit by the crash, businesses and households alike found themselves in really difficult financial situations and were demanding support from the recapitalised banks. So right from the very start, our driving mission was to enable people to lead better financial lives and it quickly became evident that the most impactful way of achieving this mission on a large scale was by partnering directly with banks and developing tools and products that could help their customers and their finances.”
The initial struggle?
According to Ludviksson, when the economic crisis hit Iceland, it created a scenario where “an incredible talent pool had become readily available for the company” as banks in the country had become less attractive as employers. This is what led the company to onboard “a collection of people who were keen to leave the traditional financial institutions and work for new and exciting startups like Meniga.”
The crisis had left the banks under major pressure from households and businesses demanding support to rebuild their finances. This is where Meniga gained an advantage and got access to its first customers. “This allowed us to get our company off to a flying start. Meniga was also one of the first fintechs around at that time providing such a service for banks, which meant we faced very little competition in those early days,” says Ludviksson.
Current fintech scenario
In the current state, the shift in consumer behaviour and regulatory developments have increased the competitive intensity within the industry and have brought about a set of new challenges to contend with.
Amid the pandemic, the demand from consumers opting for personalised services has increased. This has given an advantage to challenger banks and other players in the fintech space to work on their value proposition based on user experience and digital banking offering.
The introductions of PSD2 and Open Banking have also provided a number of innovation opportunities for challenger banks, and many of them have raised fundings on the back of the potential it offers.
“This fierce competitiveness is something that we have embraced as a company. With our banking partners constantly under pressure to remain on top of their game, we have definitely been kept on our toes to ensure we consistently develop world-class user experiences for our banks’ customers, and that the products and tools we deliver exceed the value proposition of our competitors,” Ludviksson told SC.
Let’s talk numbers
The company says it has seen significant growth in demand for its digital banking products and services over the past year. Since its inception in 2009, it has worked with more than 165 banking partners operating from more than 30 countries. Some of them include BPCE, UniCredit, Swedbank, UOB, mBank, Santander, and Crédito Agrícola. The company claims to have provided solutions to more than 90 million digital banking users across the globe, to date.
Ludviksson says, “We have quickly established ourselves as the preferred innovation partner for a large number of banks and financial institutions, and our solutions have already won multiple awards. Since the start of the pandemic, in particular, we have experienced a huge increase in the demand for our products and services. In fact, in 2020 alone, we launched a total of 18 digital banking solutions across 17 countries!”
“A big contributing factor for the success of our digital banking products is that we are in the rather unique position – as a software provider – of having a direct-to-consumer web solution and app that is free of charge and available in our home country, Iceland. This provides us with a testbed for our various solutions before they go live in other markets, and allows us to assess exactly what people like and ensure a maximum amount of customer satisfaction.”
Meniga’s services and revenue generation
Founded in 2009 by Georg Ludviksson, Asgeir Orn Asgeirsson, and Viggo Asgeirsson, Meniga is a digital banking platform that helps banks, businesses, and individuals manage their financial data. Its product offering includes data aggregation, personal and business finance management, cashback rewards, and transaction-based carbon insights.
The revenue comes in via partnerships with banks and other financial institutions, through the company’s cloud-based API integration done on the mobile banking platforms.
Use of the capital & expansion plans
According to the company, after seeing significant growth for its services, the company will use the funds to strengthen its sales and service teams, continue investment in its R&D activities, and primarily focus on the development of its innovative green banking products.
“We’re particularly excited about developing new green banking solutions, and the recent announcement of our Carbon Insight partnership with Icelandic bank, Islandsbanki, is hopefully just the first of many more of its kind,” says Ludviksson.
With offices in London, Reykjavik, Stockholm, Warsaw, Barcelona, Singapore, and New York, the company plans to expand into APAC and America next. It currently employees over 150 people across its seven offices.
According to Ludviksson, the company is looking to expand in APAC. it is already working with one of the leading banks in the region, UOB, to unveil several mobile banking innovations. In addition, Meniga is also in talks with some of the largest banks in North America to enhance their digital banking offering and help them fight back against a growing number of US challengers.