PayPal backs pan-European savings deposit marketplace Raisin
By Steve O’Hear for TechCrunch
Raisin, the savings deposit marketplace that lets you shop for a better interest rate across Europe, has picked up backing from PayPal. Described as a “strategic investment,” the new funding round remains undisclosed.
The Berlin-based company had previously raised a total of €60 million from various backers, including Thrive Capital, Ribbit Capital, and Index Ventures. Meanwhile, I’m told the new investment will be used by Raisin to accelerate growth in its core European geographies.
I also wouldn’t be surprised to see PayPal push Raisin to its users, as another channel for the startup to reach savers. Like other fintechs, half of Raisin’s battle is likely educating consumers that such as proposition exists. To that end, the company has already partnered with N26 to be listed in the challenger bank’s own app, and white labels its offering for others.
Originally founded in 2013, Raisin set out to crack open the savings deposit market in Europe by taking advantage of EU-wide banking regulation. The problem the startup solves is that saving deposit rates differ not only from one local bank offer to another but even more strikingly across Europe as a whole.
The Raisin marketplace lets you shop around and compare different rates European-wide. However, the key difference to a comparison site is that, via its own bank partner, the company offers consumers a single interface that includes account opening and anti-money laundering checks, making it easy to switch and continually ensure you get a competitive interest rate.
Related to this, for the banks that integrate with the Raisin marketplace, especially smaller and midsize banks, they get exposure to customers across Europe that might otherwise never be reached. It also gives them potential access to many more deposits, which helps with their own balance sheet lending and scale. Currently, 40 banks offer savings accounts through Raisin, ranging from overnight flexible savings to long-term deposits.
Noteworthy, in relations to today’s funding announcement, Raisin recently announced that it is planning new products related to investing, in addition to its existing savings deposit marketplace. Specifically, it says it will launch its first retail investment product in the coming months. Last year, PayPal strategically backed Acorns, the U.S. micro-savings app for millennials.