SME fintech ANNA bags £17.5m from ABHH Group

ANNA, the UK-based fintech which offers small businesses accounts and tax services, has raised £17.5 million from ABHH Group.

The investor owns Amsterdam Trade Bank (ATB) and its parent Alfa Bank, one of the largest private commercial banks in Russia which got caught up in a billion-euro money laundering scandal last year.

The fintech sets itself apart from business accounts offered by UK challengers Monzo, Revolut, and Tide

The fintech says it will use the funding to expand outside of its familiar, domestic UK market into wider Europe, by building on the rails of Netherlands-based ATB.

CEO Eduard Panteleev, who has also founded two other banking start-ups in Russia, says the investment values ANNA at $110 million, with the founders keeping a 40% stake in the start-up as part of the deal.

It’s understood that the funding began before COVID-19 gained momentum, but its likely ANNA has felt the stresses on the economy through its business customers, many of which will have had to furlough employees or shut up shop all together.

Panteleev tells TechCrunch that the crisis has impacted customer payment volumes. “We have seen that our customers’ incoming payments are quite affected, with [a] 15-30% decrease in the volume of customer payments.”

ANNA, which stands for ‘Absolutely No Nonsense Admin’, offers businesses both an account they can receive payments to, and a suite of software which helps with invoicing, accounting and tax management. In tax season, the fintech also offers businesses access to a real accountant.

Read more: Open banking will rival the spreadsheet in accountancy, says roundtable

The fintech sets itself apart from business accounts offered by UK challengers Monzo, Revolut, and Tide. “We offer more of a financial assistant to users, rather than just moving their money, and it’s also a different business case, because we look at what a user needs more holistically,” says Panteleev.

Big banks are teaming up with these fintechs to address the gap in offerings for small businesses

Businesses with a monthly income of less than £500 can use ANNA for free, after which it services companies for a monthly fee of up to £19.90 depending on monthly income, which can be up to £500,000.

With the opportunities of open banking still unfurling, both accountancy firms going through digitisation and fintechs in the space can own the entire customer journey, putting pressure on incumbent banks to adapt their own services to compete.

Account-to-account (A2A) payments fintech Nordic API Gateway told FinTech Futures last month that it has seen “a lot of traction” for its services in the accounting space, as many seek to get access to business accounts.

“We’re still in the mandated phase,” CEO of NatWest’s Mettle, Marieke Flament said at a roundtable last month on the status of open banking in accountancy. She pointed to the coronavirus as the “genesis” for its acceleration – part of the bigger digitalisation push across all sectors.

Last month, fellow UK-based banking and accounting app Countingup raised £4 million in a bridge round led by ING Ventures. The raise, just like ABHH’s involvement in ANNA’s capital injection, shows that big banks are teaming up with these fintechs to address the gap in offerings for small businesses.

“Once the pandemic comes to an end, there will be a very clear realisation that neither corporates nor family businesses can afford to run most operational processes manually,” says Alan Vaksman, member of the supervisory board at Amsterdam Trade Bank and future chairman of ANNA. “Tech services and platforms, like ANNA, are in for some dynamic times ahead.”

Read next: Swedish fintech Bokio lands $8m and merges with competitor Red Flag