Lunar raises €210 million in Series D funding as it takes on Klarna
Lunar, the digital challenger bank from Denmark, has announced that it has raised €210 million in its Series D funding that was led by Heartland investment company along with other investors like Kinnevik and Tencent from China.
This heats up the payments and banking industry race in the Nordic region with consolidation happening in the industry and Lunar also setting itself up for stiff competition with Klarna, the other giant in the European region.
Ken Villum Klausen, founder, and CEO of Lunar said that,” We are at a true crossroads in the Nordics.Both private and business customers expect a more convenient, empathic, and engaging alternative to traditional banks, lenders, and payment service providers. The investment underpins Lunar’s long-term vision of building a digital-first financial ecosystem for both private consumers and businesses.”
Investors and payment providers believe that the Nordic region is the next region in Europe that is set for huge growth in the coming years. This region has seen relatively less penetration of digital payments and financial services and hence it is believed that there is a lot of space to grow in this industry. That is why we are seeing a lot of investors showing interest in the companies dealing in this space in this region.
The bank currently has operations in Denmark, Norway, and Sweden and it is expected that the new funds would be used for expansion across the region and also to help with acquisitions along the way that would help its growth.
Last year, the company had raised €40 million in Series C funding towards the end of the year and had also entered the Pay Later business space which has been growing very strongly in recent months around the world and has been a hit with the millennials. This has placed it in direct competition with Klarna which is now focussing on the social e-commerce domain.
Neobanking is the latest buzzword in the banking circles as they look to cut costs in terms of physical branch spaces and bring all their operations online either via a website or through the mobile app. This sits well with the new millennial generation of users who spend most of their time online and do not have the time to walk into a bank branch. The old legacy banks have been grappling to make the transition into the digital world and those startups that build their services around the digital banking industry are seen as direct and strong challengers to the established legacy banks in this new digital playground.
