Investment rounds by digital only banks – February 2020 update

digital banks investments

2019 was a huge year for investment rounds by digital banking startups, with many now reaching for successful funding rounds D and E. 

This is just as well, as this emerging sector is yet to turn a profit, and will continue to rely on external funding as lifeblood until challenger banks find a way to monetise this new kind of business model properly. 

Meanwhile, the market for digital banks is growing rapidly and some of the leading challengers are now drawing in hundreds of millions of dollars of new investment. Here we detail some of the most significant investment rounds for leading and emerging digital banks across the globe. 

UK digital banks


In October 2019 Revolut, now one of the UK’s leading financial service companies, called in JP Morgan to manage its latest investment round. It raised £380 million ($500 million) from Silicon Valley investors TCV, as well as taking on a £760 million ($1 billion) loan, which will convert into shares if the bank achieves a US banking license. Revolut looks set to receive a valuation of £3.2 billion ($5 billion) due to this successful capital raising. 

This followed 2018’s investment round, which saw the startup rake in £190 million ($250 million) in investment led by DST Global, which gave the bank a valuation of £1.3 billion ($1.7 billion). 


With now over a million account holders, the UK’s leading digital bank Starling is going from strength to strength and has just raised another £30 million ($39.5 million) in a new funding round. Led by Merian Chrysalis Investment Company Ltd with a hefty investment of £20 million ($26.4 million), existing investor JTC, has topped the pot up with another £10 million ($13.6 million). 

This latest round follows a £75 million ($99 million) investment in February 2019 by Merian Global Investors, plus a £100 million award ($131 million) from the Capabilities and Innovation Fund in the same month. It brings the total investment into Starling to £263 million ($345 million). 

The new funding will fuel more expansion of the bank’s retail and SME banking services and promote its ventures further in Europe.

Starling is hoping to win the race among the UK’s three major digital banks to break even, despite it having the lowest number of customers of them all, with plans to break even by the end of 2021. 


Following its last investment round in 2019 of £113 million ($150 million) from Y Combinator Continuity and Latitude, UK digital bank market leader Monzo is reportedly seeking another £100 million ($131 million) of funding in 2020, although the details are yet to be formally announced. 

Coconut Bank

On the smaller end of the scale, the UK startup bank aimed at freelancers and sole traders Coconut raised £1.86 million ($2.45 million) from 1997 investors in 2019. The bank, which specializes in making taxes easy to manage and returns easier to file, now has 3,000 accounts open. 

European digital banks

N26 (Germany)

In its last funding round, which closed in July 2019, German digital bank N26 raised £129 million ($170 million) from its existing partners. This followed a previous round just a few months before, which brought in £227 million ($300 million) for this leading fintech startup, bringing its total investment to date to £508 million ($670 million). 

Tink (Sweden)

In January 2020, the Swedish digital business banking startup Tink announced it had completed an investment round worth £75.6 million ($100 million). It was co-led by Insight Partners plus two newer investors, the San Francisco-based HMI Capital and London’s Dawn Capital. 

This is Tink’s largest investment round to date and follows on from the company raising £47 million ($62 million) in February 2019. 

CEO and Co-founder of Tink, Daniel Kjellén, said the investment would go towards making the startup’s ambitious plans to become “the preferred pan-European provider of digital banking services”.

US digital banks


Coming onto the neo-banking scene with a roar, US banking startup MoneyLion, which delivers a hybrid of digital banking, online lending, and wealth management via its app, which now has over 5 million users, according to the company.

It raised £76 million ($100 million) in 2019 in Series C funding, jointly led by Greenspring Associates and Edison Partners, plus investment from Metabank, Capital One, and FinTech Collective. 

This latest round can be added to the £45.5 million ($60 million) previously raised by the bank in unannounced funding, bringing the total fund raised to £172 million ($227.5 million) as of July 2019.


2019 was a big year for US digital bank Chime, which saw it quadruple its valuation to reach £4.4 billion ($5.8 billion) in less than one year. It gained another million customers to bring its base to a massive 6.5 million customers. That year, two funding rounds raised it £530 million ($700 million) altogether, bringing its total investment funds raised to £613 million ($808.8 million). 

Brazil and Argentina digital banks


Founded in Brazil, Nubank was set up to provide the country’s bankless with access to accounts and named the largest Latin American fintech. In 2019 it raised £303 million ($400 million), taking its total investment to £830 million ($1.1 billion) in July 2019. By October of that year, the bank had reached 15 million customers, a 25 percent increase in just two months. 


Argentinian financial management app Ualá is backed by Asian multinationals SoftBank and Tencent, along with Goldman Sachs. The funding round launched in November 2019 tripled its funds. It marked Softbank’s first-ever investment in Argentina, raising a total of £114 million ($150 million), to add to the £33 million ($44 million) previously raised and taking the startup’s valuation to nearly £760 million ($1 billion), as reported by Bloomberg.