Canadian FinTech Neo Financial raises $258m in Series D round

By Gloria Mathias

Neo Financial (Neo), a Canadian financial technology company, has announced its $258.2 million (CAD 360m) Series D fundraising round, which consisted of $78.9 million (CAD 110m) of equity and $179.3 million (CAD 250m) of debt.

This round of funding includes investments from Canadian founders and entrepreneurs bringing in their wealth of experience in scaling global tech brands. Existing investors, including Valar Ventures, Golden Ventures, Afore Capital, and Thomvest Ventures, also participated in this round.

“Neo Financial’s growth over the last 4 years reflects Canadians’ strong demand for alternatives to traditional banking,” said Andrew Chau, co-founder and CEO of Neo. “We’re building time- and money-saving financial products that will help Canadians for decades to come. Despite being in the lowest period of venture funding that FinTech has seen in the last 5 years, we’ve been able to raise one of the largest FinTech funding rounds globally this year. This growth capital allows us to continue winning the hearts and minds of Canadians, serving them when they need it the most. Canada continues to lag in productivity and innovation, and our team is on a mission to reverse that trend and make Canada a better place to live.”

Neo offers eight products and has established near-product parity with the legacy Canadian banks. This capital injection will accelerate product velocity, enabling Neo to continue building products, AI-native insights, automations, and features for Canadians.

Products and features include:

• Premium Credit Cards: Neo offers Canada’s best no-annual-fee and cash-back credit cards, including the Neo World Mastercard® and the Neo World Elite® Mastercard.
• Competitive Mortgage Rates with Neo Mortgage: Neo Mortgage provides highly competitive, transparent, and tailored mortgage rates, helping Canadians achieve their home ownership goals without compromising on budget.
• AI Money Insights for Smarter Budgeting: Neo’s AI Money Insights is a tool that leverages AI to help Canadians budget smarter. It offers a comprehensive view of finances.
• High-Interest Savings accounts with interest rates: Neo’s HISAs allow customers to grow their savings with ease. Canadians can create up to 10 accounts to help people allocate their money effectively, each earning one of the highest rates in Canada.
• Automated Savings Options: Neo’s savings automation feature makes saving money effortless. Customers can set automatic transfers to grow savings in the background seamlessly.
• Instant Bill Pay: Canadians can pay bills immediately, keep track of expenses, and get insights into their spending, all within the Neo app.
• This is in addition to Interac e-Transfers® to send and receive money, access cards for bank accounts, and ATM access to withdraw cash, core functionality that typically only traditional banks provide.