Amount, a novel service designed to empower established banks in the evolving digital landscape, has secured $81 million in funding led by Goldman Sachs. This investment aims to assist traditional financial institutions in effectively competing with more adaptable, digitally-focused companies.

The company, originating as a spin-off from the lending platform Avant in January of this year, has already established partnerships with Banco Popular, HSBC, Regions Bank and TD Bank. These collaborations will integrate Amount’s technology to enhance their digital banking capabilities and introduce offerings such as point-of-sale financing, directly challenging newer banks like Chime and lending services like Affirm and Klarna.

“Many banks are actively seeking resources and infrastructure to expedite their digital strategies and fulfill the expectations of modern consumers,” explained Jade Mandel, a vice president within Goldman Sachs’ growth equity division, GS Growth, who will also join Amount’s board of directors, in a released statement. “Amount facilitates banks’ digital transformation through a flexible, mobile-focused platform for financial products. We are pleased to collaborate with their team as they pursue this significant market opportunity.”

In addition to customer-facing features, Amount provides robust fraud prevention expertise, enabling banks to extend credit more confidently and with reduced risk compared to their competitors, according to chief executive Adam Hughes.

This combination of services was instrumental in Goldman Sachs leading a new $81 million investment in the company, with contributions from existing investors August Capital, Invus Opportunities and Hanaco Ventures — resulting in a post-money valuation of $681 million and bringing the company’s total funding raised in 2020 to $140 million.

Amount functions as a white-labeled digital banking solution for banks that have not yet modernized their services to align with the needs of a new customer base or the increased demand for digital-first services spurred by the COVID-19 pandemic.

Access to Amount’s services comes at a substantial cost for banks. Beyond a percentage-based fee for each loan processed through the platform, there is an initial implementation fee that generally averages around $1 million.

This significant investment reflects the level of concern banks have regarding emerging digital competitors. Hughes noted a considerable increase in adoption following the launch of their buy-now-pay-later product, designed to compete with rapidly growing companies like Affirm and Klarna.

By providing these services, Amount presents a competitive challenge to Klarna and Affirm. Banks potentially benefit from a lower cost of capital, allowing them to offer more favorable rates to borrowers, and possess the financial strength to approve a larger volume of loans than these newer lending companies.

 “Amount is experiencing strong momentum and is gaining industry recognition,” stated Nigel Morris, a co-founder of Capital One and an investor in Amount through QED Investors. “This latest funding round brings Amount’s total capital raised in 2020 to almost $140 million, which will support further investment in platform research and development and accelerate the company’s market entry strategy. QED is excited to be involved in Amount’s journey and anticipates continued success as it plays a crucial role in the digitization of financial services.”

FT Partners acted as an advisor to Amount during this transaction.