Ever since the pandemic began, we have witnessed a sharp rise in the need for digital services, with banking being one of them. While digital banking is on the rise, legacy banks have also realised the need to go digital. The French startup TagPay helps financial institutions by offering a complete suite of scalable and open Core Banking System technology. The company has now raised €25M in its latest funding round.
Largest funding yet
The private equity firm Long Arc Capital, which is based out of New York City, led the latest investment round for TagPay. With the investment, the private equity firm now owns a majority stake in the startup, while its co-founders Yves Eonnet (CEO) and Hervé Manceron (COO) will continue in their leadership roles with the company.
The latest funding round for the startup is said to help it strengthen its sales, product and technical teams while accelerating its growth in the European market. By 2023, TagPay intends to double its banking customer base to around 30 million. TagPay raised €7M in its previous funding round and in its new growth phase, Société Générale, which previously invested in the company, will remain a minority shareholder and partner of the company.
“The regulatory evolution, the new expectations of end customers and the disruption in financial services makes the modernisation of core banking systems a necessity,” says Yves Eonnet, CEO of TagPay. “Today, thanks to its open and agile architecture system, TagPay is the premier solution to address these challenges. We are very happy to have the support of Long Arc Capital, whose financial and operational support will allow us to grow rapidly over the next three years.”
Digital transformation of financial services
With neo-banking on the rise and the need for digital banking services surging, the financial industry is moving towards a complete overhaul. According to TagPay, the true opportunity lies in “core banking systems”, which are the back-end systems providing different capabilities required by banks to rapidly design and deploy innovative, personalised financial products.
Founded back in 2016 by Yves Eonnet and Hervé Manceron, TagPay aims to deliver the service of a cost-efficient, next-gen core banking system to financial institutions. The company’s product is slated to transform inefficient legacy systems into scalable, open-architecture platforms that could enable financial institutions to innovate and improve customer experience.
As per the company, since launching its services in 2016, over twenty financial institutions, including retail banks, digital banks, payment institutions, and e-money institutions, are using TagPay’s services. The startup currently operates across three continents; Africa, LATAM and Europe. The fresh funds will also be utilised to expand its customer base to around 50 clients. It will also recruit more people and aims to double its workforce in the next 18 months.