Fourthline bags $54M to ease customer verification for financial institutions

CLOUD

Netherlands-based financial technology startup Fourthline BV today announced that it has raised €50 million, or about $54 million, from Finch Capital and other unnamed returning investors.

When a consumer signs up for an online financial service, the bank that provides the service must collect certain documents to perform identity verification. Fourthline offers a cloud platform that promises to ease the task. According to the startup, its platform can detect fraud with 99.98% accuracy while reducing the amount of manual work involved in the process.

The platform is built on a set of internally developed artificial intelligence models. The models can process more than 3,500 types of documents from 185 countries, the startup says. They detect counterfeit and manipulated documents, as well as other fraud indicators. 

After the initial customer onboarding process is complete, banks must continue monitoring user accounts on an ongoing basis to detect potentially malicious activity. Fourthline says its platform can help with that task as well.

There are situations where hackers may gain access to a legitimate bank account and attempt to illegally move funds. When a breach is suspected, Fourthline can re-authenticate users to ensure that their accounts have not been compromised. The platform also provides dashboards that enable banks to monitor risk levels in their user bases. 

Historically, financial institutions used separate tools for tasks such as customer onboarding and risk monitoring. Each tool that a bank adopts has its own application programming interface. As a result, banks often have to integrate multiple APIs into their systems, which can involve a significant amount of manual work.

Fourthline provides all its platform’s features through a single API. The result, according to the company, is that the platform can be deployed faster and with less custom code than competing offerings. It says that banks can integrate its software into their applications in as little as a few weeks.

“A lot of RegTech point-solutions do not truly alleviate the compliance burden on regulated entities as evidenced by the thousands of employees performing manual checks at banks that have deployed point solutions,” said co-founder and Chief Executive Officer Krik Gunning. “At Fourthline, we provide financial institutions with a single, banking-grade solution for continuous, ‘lifetime’ financial compliance.”

Fourthline launched its platform in 2018 and claims to have “grown more than 80% yearly” since. Its customers include N26 GmbH and Qonto, two of the fintech segment’s most well-funded banking startups. Its platform is also used by more established companies such as NN Group NV, one of largest financial institutions in the Netherlands. 

Image: Fourthline