TransBnk, a banking infrastructure platform, secures $25 million in Series B funding spearheaded by Bessemer Venture Partners, joined by Arkam Ventures and Fundamentum Partnership.

Current investors 8i Ventures, Accion Venture Labs, and GMO Venture Partners also took part in the round. In August 2024, TransBnk secured $4 million in Series A financing.

The organization plans to utilize the capital to grow its operations in the Middle East and East Asia, in addition to recruiting technology and product management professionals.

Established in 2022 by Vaibhav Tambe, Lavin Kotian, Pulak Jain, and Sachin Gupta, TransBnk is creating a transaction banking platform for fintech companies and other businesses to connect with the banking ecosystem. The company's offering enables its clients to utilize banks' application programing interface (API) to streamline corporate transactions. API is a set of rules that enables communication between two distinct software systems.

Transaction banking services encompass escrow account administration, trade financing, remittances, cash handling and distribution, in addition to tax remittances. The companies in the sector consist of Tazapay, TransBnk, Setu, and Escrowpay, among others.

Despite rapid advancements in retail payments, corporate banking has historically remained stagnant. “The company stated in a media release that a significant gap exists in the way corporations and lenders handle their digital banking activities, particularly regarding the management of a disjointed landscape of accounts, interfaces, and manual procedures.”

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Transaction banking was previously led by a handful of private sector banks, including IndusInd Bank and Yes Bank, until recent years. In addition to banks’ technology partners, major existing vendors include IT services firms like FIS, Tata Consultancy Services, and Infosys.

Nevertheless, SaaS fintechs currently provide the product for a tenth of the price. Banks are shifting away from large, capital-intensive software systems.

“Traditional providers are expensive and may take years to deploy, frequently resulting in awkward and disjointed solutions,” the company stated.

TransBnk has connected with over 40 financial institutions and serves over 220 clients who utilize nearly 1500 APIs each month.

“Our proprietary technology infrastructure is currently driving major financial organizations and corporations. We are currently extending this throughout BFSI, mid-sized companies, and SMEs. Tambe stated that TransBnk is well-positioned to grow outside India, gaining positive momentum in Southeast Asia and the Middle East markets, while also concentrating on bolstering our presence in the local market as a rising leader in banking infrastructure.

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A significant factor that benefited TransBank in recent years was the Reserve Bank of India (RBI)’s requirement that, within a consortium of lenders, any bank that does not contribute at least 10 percent of the total corpus cannot offer transaction banking services as a collaborator with the other banks in the consortium.

This has compelled the majority of public sector banks and some private sector banks to seek immediate solutions available in the market, primarily as a SaaS offering and generally charged on a per-transaction basis.