Prepaid payments platform Recharge raises €45m to go on M&A spree

With inflation still stubbornly high compared to previous years and the siren call of subscription services like Netflix and Spotify continuing to be enticing, consumers are understandably turning to alternative forms of payment to manage their households. As a result, prepaid online payment platforms have benefited.

That’s the bet today RefillA major European player in online prepaid payments secured a €45 million debt facility with ABN AMRO to expand the market through an M&A round, as well as looking at moving into Fintech-type services that could eventually compete with some companies. from larger payment platforms.

With a range of digital vouchers from brands including Apple, Google, Spotify, Xbox and PlayStation, as well as cross-border money transfers, Recharge is attacking the market from several consumer angles.

It says it already has strong cash reserves and is targeting revenue of more than €100m in 2025, claiming annual revenue growth of 30% in 2024.

With the new funding, there will be a significant war chest for acquisitions.

In an interview with TechCrunch Recharge CEO Günter Vogelpoel said: “We see an opportunity to grow faster through M&A and there are a number of opportunities that we can consolidate in other markets and segments, especially since this industry is still very young.”

The prepaid card market in Europe grew at a CAGR of 7.6% during the period 2019-2023. Between 2024 and 2028 is expected Growing from $251 billion in 2023 to $395 billion by 2028, registering a CAGR of 9.1%.

More interestingly, Recharge’s application for an electronic money license with the Dutch authorities indicates that it has plans to create a more robust “Fintech” style platform.

Vogelpoel said that Recharge is “very interested” in expanding into financial services: “We are in the process of applying for an Electronic money license in the Netherlands, which will give us a license for Europe. With this, we can launch our own financial services.” He added that they would “fit well with our existing customer base” for a wallet or card-type company in the market.

But what about the technology aspect of this next phase?: “We’re a profitable company,” Vogelpoel said. “We have more than 30% growth in 2024, which has increased our profitability. So we have money in the bank to invest in our platform and technology.

It also makes sense for customers to move to larger holdings, he says: “If you have a wallet as a central product, then you can integrate other services into that wallet, as well as payments or cards that people can use to issue virtual cards… Neo banks have a really good portfolio of services, but we are particularly responsive to the needs of our customers who like budget, control, as well as privacy and security.”

As prepaid offers more privacy in some services, he believes these privacy and security aspects may give Recharge an edge going forward.

Bas Janssen, senior banker, Digital and Consumer clients at ABN AMRO, said in a statement: “We see great promise in Recharge’s growth trajectory as they expand their reach in the global prepaid payments space.”

Fill it in 2021 before In 2019, it raised a €10 million ($11.8 million) debt financing round from London-based Kreos Capital, a $35 million Series B round led by new investor SmartFin, and €22 million from Prime Ventures.