Fintech
Neobank startup Mercury is taking on Brex and Ramp with new bill payment and expense management software
Digital banking startup Mercury is integrating software into its bank accounts, giving its corporate customers the ability to pay invoices, invoice customers and reimburse employees, the company exclusively told TechCrunch. The additional features put the company in even more direct competition with the likes of Brex and Ramp, two rival fintechs that have been fighting for market share in an increasingly crowded space.
The fintech, which has been offering banking services to startups and other businesses since 2019, is expanding by first offering accounting automation and more sophisticated bill payment capabilities with new software that will be integrated with its bank accounts, executives said exclusively at TechCrunch. It will also begin offering employee billing and reimbursement this summer.
Mercury says it has more than 200,000 customers who send $4 billion in outgoing payments each month through its platform.
“As companies get a little more sophisticated, they want to have more controls over those payments in terms of approvals, and they want those payments to integrate better with their accounting system,” CEO and co-founder Immad told TechCrunch Akhund in an interview. “Our plan is to continue adding more of these items to the bank and to [customers’] financial situation.”
Competitively, the moves pit Mercury against fintech companies beyond Brex and Ramp such as Navan, Airbase and Mesh Payments, as well as incumbents such as Bill.com, which also offers an invoicing solution.
Notably, it positions Mercury in even more direct competition with Brex, which also offers bank accounts, corporate cards, bill payments and expense reimbursements. The two companies were among the fintechs he benefited more When Silicon Valley Bank imploded in 2023 – although the Brex growth surge is said to have had some crashed last year.
While Mercury is well known in the startup world and is the group it started serving, Akhund says startups today make up less than 40% of its customer base as the company has diversified over the years. E-commerce companies represent the second largest customer base. Ramp CEO and co-founder Eric Glyman recently told TechCrunch that venture-backed startups represent a “minority” of its customers. Brex initially focused more on startups before announcing it a push towards the enterprise and its foray into software, then a de-emphasis on smaller businessesand then later a renewed commitment to startups.
New workflows
With advanced bill payment software, customers will be able to pay bills directly from their bank accounts with features such as AI-powered invoice detail entry, duplicate invoice detection and the ability to approve payments on mobile devices and via Slack.
Previously, Mercury’s enterprise customers could make payments to suppliers, and for a time it had parts of the invoice payment functionality, including optical character recognition (OCR) of invoices, “but it didn’t address the most comprehensive workflow of bill payments in a way that would completely replace third-party bill payment tools for larger customers,” the company said.
Beyond that, the company now also provides accounting automations, including a new NetSuite integration, which will enable operations such as categorizing and syncing invoices and expenses as they are initiated.
This summer, Mercury will also offer businesses the ability to create professional invoices, allow customers to pay with credit cards or directly from their bank (via ACH), and the ability to send automated invoice reminders. They will also be able to set refund policies and track spending.
The new software “includes the ability to establish more precise approval controls and accounting integrations so that all invoicing activity is automatically recorded correctly,” the company told TechCrunch. “So we’re rolling out more ERP (Business Enterprise Resource Planning) type capabilities that build on the money movement aspects of bill payment that we already had.”
Access to the new workflows is free until August 1st. After that, the company will offer a variety of paid plans depending on the size of the company and its needs, ranging from $35 to $350 per month.
Like other digital banks, Mercury is not itself a bank. It provides banking services through partners Choice Financial Group and Evolve Bank & Trust. It started offering a business credit card about 18 months ago.
Dan Kang, Mercury’s former vice president of finance, said Mercury’s type of customers make the company ripe for offering additional products.
“It’s not just about people parking money in Mercury after SVB,” he told TechCrunch, noting that Mercury’s finance team itself has been beta testing all new products. “They’re actually really using it to run their business.”
Expanding into software isn’t the only branching Mercury has made of late. Even the start recently expanded to personal banking. In addition to earning from interchange fees and interest rate spreads, Mercury will earn money through this new offering by charging users an annual subscription fee of $240 on their first deposit.
All of these moves come at an interesting time for Mercury, which made headlines earlier this year for coming under federal scrutiny over its practice of allowing foreign companies to open accounts through one of its partners, Choice Bank, according to a relationship of The information.
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