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Kevin, a fintech startup based in Lithuania, has launched an API tool that cuts out credit cards as the middlemen in mobile payments. To scale into new markets, the company just closed a €1.5 million seed round with business angels from the finance and insurance industries.
Using the API, merchants can accept payments directly from bank accounts for services like parking, taxis, car-sharing, deliveries and insurance. UniPark, the largest parking operator in the Baltics, is using the solution for in-app payments and reports paying 80 percent less on average for transaction fees.
“With a typical flat charge per payment of €0.07, plus an additional charge of around 1 percent, companies providing low-priced services like parking can end up paying up to 10 percent to card networks per payment,” explains Tadas Tamošiūnas, co-founder and CEO.
The solution complies with PSD2, a European regulation for electronic payments that essentially allows open banking and demands its security.
In fact the startup claims it’s the first PSD2 solution that competes with credit cards in these types of daily services. So far fintechs’ success in the market has mostly been with one-time e-commerce payments.
Currently running in the Baltics, Poland, the Netherlands and Portugal, the Vilnius-based company plans to enter 15 more European markets this year.
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