Stripe led a $12 million Series-A round in PayMongo, the start-up revealed today, an online payment network located in Manila.
The first Filipino-owned financial technology startup to take part in the accelerator program of Y Combinator was PayMongo, which provides an online payment API for companies in the Philippines. Another previous participant, Y Combinator and Global Founders Capital, both returned for Series A, which also included participation from new supporter BedRock Capital.
PayMongo works with financial institutions, and its offerings provide a payment API that can be embedded into websites and applications, enabling bank card and digital wallet payments such as GrabPay and GCash to be accepted. The startup offers PayMongo Links for social commerce sellers and other individuals who sell mostly via messaging apps, which buyers can click on to send money. Features including a fraud and risk identification feature are also included in PayMongo’s platform.
In a statement, Noah Pepper, APAC business leader of Stripe, said it invested in PayMongo because “we were impressed with the PayMongo team and the pace at which so many companies across the Philippines rendered digital payments more available.”
The start-up launched with $2.7 million in seed funding in June 2019, which the founders said was one of the largest seed rounds ever raised by a fintech start-up based in the Philippines. PayMongo has now raised almost $15 million in funding in total.
Francis Plaza, co-founder, and chief executive said that since its launch, PayMongo has handled a total of nearly $20 million in payments, rising at an average of 60 percent since the beginning of the year, with a spike after lockdowns started in March.
He added that the company originally intended to begin growing its Series A in the first half of next year, but the rise in demand for its services during COVID-19 prompted it to start the round sooner so that it could recruit and speed up the introduction of new features for its product, design and engineering teams. This will include more options for online payment; invoicing and marketplace features; support for business models such as subscriptions; and shorter payout times.
PayMongo also aims to introduce more financial service provider partnerships, develop its fraud and risk management systems, and secure more central bank licenses so that it can begin working on other forms of financial products.
The startup is among Southeast Asia’s fintech companies that have seen accelerated growth as the pandemic of COVID-19 prompted several companies to digitize more of their operations. Plaza said that because of the country’s lockdowns, total digital transactions in the Philippines grew 42 percent between January and April.
Currently, PayMongo is the only payment company in the Philippines with an onboarding process that has been developed to be entirely online, he added, making it attractive for merchants who first accept online payments.
If the momentum continues as lockdowns in various cities are lifted, that means that the central bank of the Philippines is on track to achieve its objective of raising the number of e-payment transactions to 20% of the country’s total transactions this year.