AbbeyCross raises $2.47m to develop FX market infrastructure for EM currencies

Many EM currencies are currently traded without full-price discovery, creating an unlimited compliance and regulatory risk.

AbbeyCross has raised $2.47 million USD in pre-seed funding for its B2B trading and compliance marketplace focused on improving the underlying market infrastructure for Emerging Market (“EM”) currencies.

The pre-seed funding round was led by Third Prime, with participation from Communitas Capital and eleven strategic angel investors from within the payments industry.

The London-based startup works with global banks, their currency suppliers, and other financial services providers in order to bring deeper currency liquidity, price transparency, and market data to a fragmented EM currency payment industry.

Current situation in EM currencies in intolerable and unsustainable

Mike Robertson, CEO and Co-founder of AbbeyCross, said: “We are thrilled to have seen such great support and enthusiasm from the market for our pre-seed round. We are grateful to our investors and look forward to developing the AbbeyCross solution and changing the EM currency market for the better. The current situation is intolerable and unsustainable for those who rely upon the exchange of EM currencies, the banks and payment providers and the regulators themselves. Price transparency and deeper liquidity is desperately needed and that is what AbbeyCross intends to deliver.”

Keith Hamlin, Founding Partner at Third Prime, said: “While currencies can efficiently be swapped between developed markets, in emerging markets the cross-border payment ecosystems are opaque and lack competitive pricing. The AbbeyCross team brings a wealth of knowledge and experience to this underserved segment of the payments market. Their cross-border EM payment platform will revolutionise the space by driving down costs and enabling demonstrable regulatory compliance.”

Doug Atkin, Managing Partner of Communitas Capital, said: “Communitas looks for entrepreneurs with industry changing ideas. The AbbeyCross marketplace is going to change an industry, and we’re excited to work with a team that have the experience, expertise, and network to solve a challenge that is set to grow.”

AbbeyCross brings multiple liquidity and settlement providers together

AbbeyCross believes that, in a globalised world, it should be easy to transfer money to and from anywhere in the world, but innovation in foreign currency exchange has been focused on developed markets, despite money that is transferred in Emerging Markets often being needed more urgently when compared to money transferred in developed markets. This problem affects some 6 billion people, charities, NGOs, corporates, and governments worldwide, according to the firm.

The EM currency market infrastructure added that the illiquid nature of EM currency pairs, the reduced correspondent banking relationships, and complex regulation increase the costs and friction to exchange.

Unnecessary costs are estimated to be in the ballpark of USD10 billion each year for banks and payment providers, and many currencies are traded without full-price discovery, creating an unlimited compliance and regulatory risk, the firm explained as it presented its solution.

By providing multiple vendors on its marketplace, AbbeyCross creates price competition, increased transparency, and improved market data.

AbbeyCross brings multiple liquidity and settlement providers together and enables banks and payment providers to achieve new technical and operational efficiencies, significant cost savings, and reduced regulatory and compliance risk.