Zaver Secures $5 Million to Expand Cardless Payments

Zaver, a Swedish fintech company, has successfully raised $5 million in a new funding round. The company specializes in enabling merchants to facilitate cardless payments and integrate buy-now-pay-later (BNPL) options.

From P2P to Durables Focus

Initially concentrating on peer-to-peer payments within marketplace environments, Zaver is now strategically prioritizing the durables sector. This includes industries like automotive, health & beauty, and craftsmanship, for both digital and physical retail.

Investors Back Zaver's Growth

The latest funding round saw participation from prominent venture capital firms, including Inbox Capital – known for investments in companies like Revolut and Klarna – and Inventure. Additional investors include Fredrik Österberg, Magnus Rausing, Joen Bonnier, Fabian Hielte, Max Hobohm, and Johannes Hobohm.

Accelerating Mobile Payment Adoption

Established in mid-2016 by Amir Marandi and Linus Malmén while they were students at the KTH Royal Institute of Technology in Stockholm, Zaver aims to expedite the transition from traditional plastic cards to mobile payment solutions. Their initial target market is Sweden, with a focus on the “durables” segment.

Key Features and Functionality

Zaver’s offerings encompass a range of payment functionalities. These include online and offline cardless payments powered by open banking, immediate payouts for merchants, BNPL services, and robust credit scoring capabilities.

Defining the "Durables" Market

“We define ‘durables’ as goods and services that aren’t frequently purchased and generally have a prolonged lifespan,” explains Marandi. “Examples include automobiles, dental appointments, or kitchen renovations.” He further notes that these purchases typically involve higher transaction values compared to everyday retail items.

Significant Processing Volume Growth

Since the introduction of “Zaver for Business” two years ago, the company has experienced substantial growth. Marandi reports processing volumes have risen from zero to “hundreds of millions of dollars.” This demonstrates a clear shift in consumer behavior.

Customization and Control Through Direct Payment Rails

By circumventing traditional card networks, Zaver gains the ability to independently manage pricing, user experience, and product development. This level of control was previously unattainable. The company’s strategy centers on providing a comprehensive banking and payments platform for small and medium-sized enterprises (SMEs) within the durables sector, with BNPL playing a crucial role in evolving customer preferences.

Competitive Landscape and Differentiation

Zaver identifies traditional financial products, such as credit cards and factoring companies, as its primary competitors. However, Marandi emphasizes their distinct approach. “We concentrate on the move towards mobile payments within a sector characterized by low margins and substantial average transaction values.”

He continues, “By capitalizing on emerging customer behaviors – including BNPL, direct debit, and point-of-sale installments – and offering real-time settlements, we deliver a seamless payment experience both online and offline, regardless of transaction size.”