In a significant development within the financial technology sector, Zūm Rails, renowned for its innovative all-in-one payments gateway, has successfully closed a Series A funding round, raising $10.5 million CAD. The funding round was spearheaded by Arthur Ventures, a Minneapolis-based growth equity firm with a focus on B2B software solutions.

The Need for Innovation in the U.S. Payments Landscape

The United States has traditionally lagged behind in adopting standardized practices for open banking and instant payments. However, the landscape is undergoing a transformation, thanks to emerging data sharing regulations and the introduction of new programs like FedNow. Despite these advances, businesses still face challenges in offering seamless transaction experiences due to the fragmented nature of the existing payments ecosystem.

Zūm Rails’ Solution to Payments Fragmentation

Zūm Rails addresses these challenges by integrating open banking and instant payments into a unified gateway, streamlining the transaction process. This solution encompasses a range of functions, from customer identity verification to direct bank account linking, thus minimizing fraud and failed transactions. Zūm Rails employs an ‘omni-rail’ approach, offering both traditional payment methods and real-time options through collaborations with Visa Direct, Mastercard, MX, and Canada’s Interac network.

Statements from Zūm Rails and Arthur Ventures

Marc Milewski, co-founder and CEO of Zūm Rails, emphasized the importance of open banking for instant payment solutions, stating, “We’ve brought open banking and instant payments together in an omni-rail solution that enables companies to check off all of their payments needs from a single gateway.” Jake Olson, Vice President of Arthur Ventures, highlighted Zūm Rails’ explosive growth and its role in transforming the Canadian payments landscape, with plans for further expansion across North America.

Future Plans and Expansion

Since its inception in 2019, Zūm Rails has achieved profitability through self-funding and now processes over $1 billion in payments each month. With the new funding, the company aims to expand its services in the U.S. and introduce Banking-as-a-Service features and a FedNow offering, facilitating FDIC-insured payments within seconds.

Zūm Rails stands at the forefront of payment technology advancements, offering an integrated solution that simplifies the transaction process for businesses. The company’s strategic partnership with Arthur Ventures marks a new chapter in its mission to streamline payments across North America.

  Arthur Ventures, Banking-as-a-Service, Canada, financial technology, Fintech industry news, Instant Payments, Jake Olson, Marc Milewski, open banking, Payment Gateway, Zūm Rails