Regtech Salv has raised €3.9m in new funding from new and existing investors. The capital raise rounds off a strong year for the Estonian-based regtech. It says that it is on track to double its revenue in 2023 compared to 2022.

The latest funding brings its capital raised this year to €7.9m and total funding to €12.1m.

The investment will fuel Salv’s UK expansion, a market currently experiencing a sharp increase in Authorised Push Payment fraud.

In 2022, the UK lost over £1.2bn to fraud, with APP fraud accounting for 40% of those losses. According to data from UK Finance there was a marginal 1% drop in losses to APP fraud in the first half of 2023. On the other hand, the volume of cases surged by 22% this year.

Smaller banks and payment firms, often with less robust fraud detection and prevention systems, are particularly vulnerable.

Salv’s suite of products gives clients the necessary tools to detect, prevent and stop fraud, money laundering, and terrorist financing. Salv is used by 53 financial institutions across 12 countries. Clients, including LHV, Swedbank and SEB, rely on Salv for customer and sanctions screening, real-time transaction monitoring and risk scoring.

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Important growth opportunity for Salv

In response to raising APP fraud, the UK Payment Systems Regulator will introduce mandatory reimbursement for APP fraud victims. The regulation will place equal liability on both sending and receiving payment companies. Salv says that most banks and payment firms have overlooked inbound transaction monitoring. Specifically, their focus is on funds leaving their client’s accounts. This represents an important growth opportunity for Salv.

Taavi Tamkivi, Founder and CEO of Salv, said: “As the UK moves towards shared responsibility for APP fraud refunds, financial institutions must adapt. Our suite is critical for detecting fraudulent activities and money mule accounts, thereby reducing the financial institution’s liability. This feature, along with tools like our Bridge platform, is tailored to meet the evolving regulatory demands. The soon-to-launched AI-based no-code rule generator will enable financial institutions to swiftly adapt to new criminal behaviour.” 

Currently in its final phase of testing, the AI-based no-code rule generator is set for launch in Q2 next year. This has been developed using data from existing manually created monitoring rules validated and improved with transactional data. The tool allows for the implementation of new transaction monitoring rules without requiring developer support.