Cross-border payment platform XTransfer raises USD 15 million in Series B1 round, led by Alibaba

The company was founded by six former employees from Alibaba and its affiliate Ant Financial.

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Shanghai-based fintech XTransfer, which provides cross-border financial services to foreign trade B2B enterprises, has closed a USD 15 million Series B1 round led by Alibaba’s eWTP fund, and joined by earlier investors including China Merchants Group, reported 36Kr on Thursday.

The fresh funds will be used on license applications in more countries, such as India and Indonesia, technological upgrade and marketing. The startup now has payment licenses in the United Kingdom, Canada, the United States, Japan and Australia.

XTransfer was co-founded in May 2017 by six former employees from Alibaba and its affiliate Ant Financial, including CEO Deng Guobiao, who joined the latter’s third-party payment platform Alipay in 2010.

Cross-border payment startups have turned a hot pick for investors amid the boom of China’s cross-border e-commerce, outbound tourism, and overseas study.

The export and import value of the country’s cross-border e-commerce reached RMB 134.7 billion (USD 18.9 billion) in 2018, up 50% year-on-year, said Chinese investment bank PhoenixTree Capital citing Chinese customs data.

A total of nearly 150 million Chinese travelled overseas last year, according to data from China’s Ministry of Culture and Tourism.

Chinese students living and learning outside the Chinese mainland spent RMB 380 billion (USD 53.3 billion) on average each year, added PhoenixTree Capital, citing a report released by UnionPay International.

A total of 106 startups focusing on cross-border payment emerged between 2012 and June 2019. 42 of them raised funds from 116 venture capital firms, PhoenixTree Capital found, citing data from financial intelligence provider Qimingpian.

During 2018, 20 financing deals were completed in the cross-border payment sector in China, while the first half of 2019 already witnessed 9 financing deals.

XTransfer, NeatHK, Ksher, and Lianlianpay’s parent company Lianlian Shuzi, together with Pingpong, even closed two rounds within one year, according to PhoenixTree Capital.

XTransfer closed its USD 10 million Series A round in 2018, led by China Merchants Group.

36Kr is KrASIA’s parent company