HelloFlow, a Danish FinTech startup, has closed a USD1.6 million Seed round led by a Danish VC PreSeed Ventures, and UK-based, Seedcamp. The company provides a no-code platform for client onboarding and identity verification in the financial industry which integrates with ID authentication services in local markets.
“Using the platform, you can set up a proper, sleek, and compliant onboarding process and share it with the clients, all inside a single day. This makes it possible to launch your service in new markets across the world within 10 minutes,” explains Mikkel Skarnager, the Co-Founder and CEO of HelloFlow.
With an increasing focus on anti-money laundering (AML) processes in the financial industry, not least due to a series of international scandals and fines against financial institutions reaching USD10.4 billion in 20201, the regulatory requirements and compliance standards for onboarding new clients to banks, investment & trading platforms, crypto broker services, sports betting sites and alike have exploded.
With their digital no-code onboarding platform HelloFlow, therefore, taps into a rapidly growing market estimated to EUR1 billion at the time being.
Combined with new expectations from clients demanding the process of starting to use a service to be digital, seamless, and quick, financial businesses are under pressure to find new onboarding solutions. Not only are 45 per cent of clients likely to abandon the application form as it provides a bad customer experience, but a recent study shows that financial institutions may reduce 80-90m per cent of operational costs by digitalising their onboarding setup.
While financial institutions fully recognise these issues as well as opportunities to optimise, they struggle to find solutions on the current market, as available international services like Onfido or Dow Jones are cost-intensive and have low conversion rates, whereas the more effective process of integrating with local regulatory services takes months (at best) of developing customised IT systems as almost every country has their own solution (like NemID, BankID, MyInfo, BeID, etc).
Exactly being in charge of building a bespoke onboarding and customer identity verification (KYC) setup for the Danish bank and trading platform Saxo Bank was what led HelloFlow’s founder and CEO Mikkel Skarnager to his vision of creating a solution with low barriers to digitalisation for all financial businesses regardless of size, market or resources.