XTransfer, a Chinese cross-border financial and risk management services provider, announced Friday that it raised $138 million in Series D. The round lifts the fintech firm to unicorn status. A unicorn is an unlisted startup valued at $1 billion or more.

Why it matters: The capital signals investor confidence in services supporting small and medium-sized enterprises (SMEs).

  • The funding round came as China’s cross-border trade bounces back in the post-pandemic period. China’s import and export volume surged 23.7% year on year in the first eight months of this year, according to data from China’s General Administration of Customs. 

Details: US investment firm D1 Capital Partners led the current round with participation from existing investors.

  • The proceeds will be used to upgrade XTransfer’s products, invest in big data and artificial intelligence, bolster the anti-money laundering (AML) risk management system, and recruit talent for overseas expansion, according to the company’s statement.
  • “Cross-border e-commerce is growing by leaps and bounds due to policy support,” said Bill Deng, founder and chief executive of XTransfer. 
  • “For exporters, the latest round of overseas expansion has been a lot different from a few years earlier, marked by diverse sales channels and fragmented orders. Digitization is a major trend amid cut-throat market competition,”  he added.

Context: Founded in 2017, Xtransfer specializes in business-to-business (B2B) cross-border financial services. It serves a client base of approximately 150,000 SMEs, mostly in China.

  • XTransfer generates revenue by collecting foreign exchange service fees from clients.
  • The Shanghai-headquartered company didn’t disclose total funding but had raised $30 million at the time of the B round in 2019. That was followed by two undisclosed batches in the C round.
  • Investors in previous rounds include Yunqi Partners, Gaorong Capital, 01 Capital, eWTP Capital, Telstra Ventures, MindWorks Capital, and Lavender Hill Capital Partners.

Emma Lee (Li Xin) was TechNode's e-commerce and new retail reporter until June 2022, when she moved to Sixth Tone to cover technology and consumption. Get in touch with her via lixin@sixthtone.com or Twitter.