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Trustly

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Trustly
Type of businessPrivate
Founded2008; 16 years ago (2008)
Headquarters
Stockholm
Country of originSweden
Founder(s)Carl Wilson, Joel Jakobsson, Lukas Gratte
ChairmanMorten Hübbe
CEOJohan Tjärnberg
IndustryFinancial services
Revenue2.68 billion SEK ($265 million) (2023)
Employees900+ (2023)
URLtrustly.com
Current statusActive

Trustly AB (publ), known as Trustly is a Swedish fintech company founded in 2008.[1][2] Trustly is an open banking payment provider that allows customers to shop and pay from their online bank account, without the use of a card or app. The company claims that its account-to-account network supports 12,000 banks, reaching 650 million consumers and bypassing the card networks.

Trustly is used by more than 9,000 companies worldwide including PayPal, Alibaba, Facebook, eBay, AT&T, Unicef, Dell, Lyft, GoFundMe, TransferWise, DraftKings, and eToro. In 2020, Trustly launched in Australia and Canada, adding to its existing coverage in Europe and the US.[3][4]

In 2023, Trustly generated revenue totalling $265 million, up 14% from 2022. The overall transaction value processed during 2023 climbed by 79%, to $58 billion.[5]

History

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The company, originally named Glue Finance[6] was founded in 2008 in Stockholm, Sweden, and signed contracts that same year with the first online retailers. A first investment round was completed in 2009, and development of a second generation technical platform was launched. The company underwent a geographical expansion in 2010, after which its revenues grew by more than 200%.[7] The first office outside of Sweden was opened in Malta and over one million transactions were processed the same year. The second generation platform was launched in 2011, and 25% of the company was sold to the investment group Alfvén & Didrikson.[8]

In 2014, the company entered into a strategic partnership with Groupon[9] as well as PayPal.[10] The 10 million transactions mark was reached and the risk capital firm Bridgepoint Capital (BDC) invested €23 million to gain a minority stake.[11][12]

The arrival of Pay N Play epitomises Trustly’s mission to make online payments fast, simple and secure, transforming the way gamblers pay and play at online gambling from 2016.[13] More than 150 brands support payments with Pay N Play.[14] According to Trustly's VP of Gaming Vasilije Lekovic, this number passed 200 brands in 2022.[15]

The Swedish FinTech company ranked No. 242 on the publication's first ‘FT 1000: Europe’s Fastest Growing Companies’ list in 2017 based on its 3-year growth in revenue and staff.[16]

In March 2018, the private equity fund Nordic Capital bought a majority stake, some 70 percent of the existing shares, in Trustly. Ahead of the deal the company reportedly got valued at roughly €700 million.[17]

In June 2019, Trustly merged with Silicon Valley–based online banking payments leader PayWithMyBank. The merger enables merchants with a global footprint to accept online banking payments from European and US consumers.[18]

On June 10, 2020, Trustly announced a new round of investment from a consortium of investors, including BlackRock, which valued the company at close to $2 billion.[19]

In August 2020, Trustly expanded into Canada and Australia, marking its first step into the Asia–Pacific region.[20]

In April 2021, Trustly signalled their intention to list publicly on Nasdaq, Stockholm, seeking a valuation of almost $9bn, however the listing was postponed after Swedish regulators raised concerns about the company's lack of due diligence on its end customers.[21][22][23]

In May 2022, Trustly acquired the London-based public sector payment specialist Ecospend, which provides open banking services for HMRC.[24][25][26]

In August 2023, Trustly acquired the Paris-headquartered account-to-account payment fintech company, SlimPay for a reported sum of €70 million.[27]

In May 2024, Trustly CEO said that an IPO is still at least one year out.[5]

Security

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Trustly is a licensed payment institution authorized and supervised by the Swedish Financial Supervisory Authority in the EU, EEA, and Financial Conduct Authority in the UK.[28] In the US, Trustly is state-regulated as required to serve its target markets.[29]

A Trustly payment uses two-factor authentication.

Criticism

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Trustly faced criticism in 2013 from a competing bank when they used client information to log into the client's Internet banking. The bank claimed that Trustly had gained access not only to the information required for performing the payment but also to information related to, for example, the client's mutual funds and shareholdings and therefore, banking confidentiality had been compromised.[30] The controversy resurfaced in 2016, in Poland when PayPal switched to Trustly[31] and a number of information security related websites and banks pointed out that the Trustly's practice is inconsistent with PayPal's own guidance to avoid revealing the credentials to third parties.[32][33] In 2018, Finnish Financial Supervisory Authority ruled that the screen scraping technique used by Trustly is illegal.[34]

Trustly defended itself by saying that the company sets out a clear agreement for what information the company may access for performing payments and establishing identity, in the same way as banks. Like the banks, Trustly is under the supervision of the Swedish Financial Supervisory Authority as a licensed Payment Institute.[30]

References

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  1. ^ "Trustly: «La tarjeta de crédito no tiene sentido para pagar online»". www.webcitation.org. Archived from the original on 1 November 2015. Retrieved 2 February 2016.
  2. ^ "Trustly vill att vi betalar direkt från bankkontot". www.webcitation.org. Archived from the original on 1 November 2015. Retrieved 2 February 2016.
  3. ^ "Swidish fintech Trustly expands footprint into Australia and Canada". 27 August 2020.
  4. ^ "Trustly till börsen under andra kvartalet – vill ta in 8 miljarder kronor". Realtid (in Swedish). 12 April 2021. Retrieved 27 June 2022.
  5. ^ a b Browne, Ryan (30 May 2024). "BlackRock-backed fintech Trustly says IPO still at least one year out even as profits jump 51%". CNBC. Retrieved 30 May 2024.
  6. ^ "Glue Finance home". Archived from the original on 23 November 2012.
  7. ^ "Powerful connections Sweden Technology Fast 50 2013" (PDF). deloitte.com. Retrieved 29 July 2023.
  8. ^ "Trustly Group AB | Alfvén & Didrikson". www.alfvendidrikson.com. Retrieved 2 February 2016.
  9. ^ "Groupon adds direct bank e-Payments from Swedish Trustly as a payment method". Mynewsdesk. Retrieved 2 February 2016.
  10. ^ "PayPal and Trustly join forces for online direct transfers". www.thepaypers.com. Retrieved 2 February 2016.
  11. ^ Erlandsson, Adam (4 November 2014). "Trustly tar in 200 miljoner". Svenska Dagbladet. Retrieved 2 February 2016.
  12. ^ "Bridgepoint / Bridgepoint Development Capital Invests in European online payments services provider Trustly". www.bridgepoint.eu. Retrieved 2 February 2016.
  13. ^ "Trustly accepts online gambling payment". FeedBACK Casino. 4 December 2018.
  14. ^ "iGaming and Innovative Payment Solutions Gambling Statistics". Paynplay Casinos. 22 September 2022.
  15. ^ "TRC Speaks to Trustly's Vasilije Lekovic on Company Successes, Current Partnerships, and Innovations Set for Launch". TopRatedCasinos. 12 August 2022.
  16. ^ "The FT 1000: The complete list of Europe's fastest-growing companies". www.ft.com. Retrieved 1 May 2017.
  17. ^ Karlsson, Johannes. "Nordic Capital förvärvar Trustly i storaffär". Di Digital. Retrieved 15 February 2018.
  18. ^ "Trustly merges with Silicon Valley-based PayWithMyBank to deliver transatlantic online banking payments coverage". www.trustly.net. Retrieved 27 June 2022.
  19. ^ "Värderingen sköt i höjden när Nordic Capital sålde i svensk betalraket". 15 July 2020.
  20. ^ "Miljardvärderade Trustly tar första steget in i Asien". 26 August 2020.
  21. ^ "Trustly announces plan for IPO". 13 April 2021.
  22. ^ "Trustly announces plan for Nasdaq Stockholm IPO". Financial Times. 12 April 2021. Retrieved 27 June 2022.
  23. ^ "Trustly postpones $9bn flotation after regulator flags concerns". Financial Times. Retrieved 30 January 2024.
  24. ^ Conchie, Charlie (29 May 2022). "Trustly snaps up Ecospend in UK open banking push". CityAM. Retrieved 30 May 2024.
  25. ^ Venkataramakrishnan, Siddharth (22 August 2022). "Fintech's double-edged sword and the cost of living crisis". Financial Times. Retrieved 30 May 2024.
  26. ^ PYMNTS (31 May 2022). "Trustly Acquires Ecospend". PYMNTS.com. Retrieved 30 May 2024.
  27. ^ Gain, Vish (29 August 2023). "Sweden's Trustly snaps up SlimPay to improve recurring payments". Silicon Republic. Retrieved 29 August 2023.
  28. ^ "NewRegister". register.fca.org.uk. Retrieved 30 May 2024.
  29. ^ "About us - the Trustly journey | Trustly".
  30. ^ a b "Storbankerna tar strid mot Blockets betaltjänst - DN.SE". Dagens Nyheter (in Swedish). 17 May 2013. Retrieved 2 February 2016.
  31. ^ "Paypal oszalał i chce od Was danych logowania do banku". Zaufana Trzecia Strona (in Polish). 26 April 2016. Retrieved 27 April 2016.
  32. ^ "Największe banki zaczynają blokować korzystanie z usługi Trustly". Zaufana Trzecia Strona (in Polish). 27 April 2016. Retrieved 27 April 2016.
  33. ^ "Ostrzeżenie przed dopuszczaniem pośredników do rachunku bankowego w płatnościach internetowych" (PDF).
  34. ^ "HSL valitsi lainvastaisen tekniikan? Kauan odotettu matkakorttien latauspalvelu viivästyy taas". Yle.fi (in Finnish). 6 February 2018. Retrieved 19 February 2022.
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