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Swedish bank Nordea has continued its policy of financial technology (fintech) collaboration by forming a partnership with Stockholm-based payments startup Betalo to expand its mobile offering.
The company has been monitoring the evolution of the startup and has decided to work closely with it.
“We have followed Betalo since it was founded five years ago and think there is a good cultural fit between the two companies,” Martin Ogarp, senior strategic adviser at Nordea, told Computer Weekly. “The service offered is simple to use and brings value to our customers by complementing other products.”
Betalo’s mobile application enables consumers and small businesses to use their bank cards for domestic and international money transfers as well as to pay bills. Its partnership with Nordea opens the door to the bank’s 1.8 million private customers in Sweden.
Nordea will participate in marketing Betalo’s services, while the startup will integrate the bank’s cards into its mobile app. Ogarp said there is also ambition to extend the partnership. The companies’ aim is to offer Nordea’s customers in the Nordics an easy way to make cross-border payments.
“[The partnership] is a validation that we have built a solid and relevant platform for user-friendly banking services,” said Stefan Salomonsson, CEO at Betalo. “The ability to offer our services to Nordea’s 10 million private customers gives us enormous potential when we expand to other Nordic countries.”
The startup claims that its mobile app, which was rolled out in Sweden in late 2014, was the first in the country to make it possible to use a card to pay bills and conduct foreign transfers through an app. Today, the company has 40,000 users for its Android and iOS apps, and more than SEK1.2bn (£105m) has been transferred using the app.
The startup has secured SEK23m in outside funding and is planning a larger financing round in 2017 to fund its Nordic expansion. It has also partnered with other banks and card issuers in Sweden, including Ikano Bank, Santander Consumer Bank and online-only Lån & Spar Bank.
Nodea’s partnership with Betalo follows a string of fintech collaboration initiatives it has announced in the past year. In February, the bank’s pensions and insurance arm, Nordea Liv, joined forces with Norwegian startup Spiff to launch a mobile app for social saving. And in March, the bank launched the first version of its open banking portal targeted at fintechs and other third-party developers.
Nordea is among a host of incumbent banks that have started to see working together with startups as the way forward for the industry. In a recent fintech event in Norway, Nordea Group CEO Casper von Koskull told the audience there would be many more such announcements from the bank, adding: “We will forge partnerships, we will make investments and we will probably also do M&A in this space.”