Neobank startup Mercury takes on Brex and Ramp with new bill payment and expense management software

Digital banking startup Mercury is laerial software to its bank accounts, enabling its business customers to pay bills, bill customers and reimburse employees, the company told TechCrunch exclusively. The additional features put the company in even more direct competition with Brex and Ramp, two fintech rivals that have been battling for market share in the an increasingly crowded space.

The fintech, which has been offering banking services to startups and other businesses since 2019, is expanding initially by offering accounting automation and more sophisticated bill payment features with new software that will be integrated into its bank accounts, executives told TechCrunch exclusively. This summer, it will also begin offering billing and workers’ compensation.

Mercury says it has over 200,000 customers who send $4 billion in outgoing payments each month through its platform.

“As companies become a little bit more sophisticated, they want to have more controls around these payments in terms of approvals and they want these payments to be better integrated into their accounting system,” CEO and co-founder Immad Akhund told TechCrunch in an interview . “Our plan is to continue to add more of these kinds of building blocks to the bank and the bank [customers’] financial stack.”

Competitively speaking, the moves pit Mercury against fintech companies beyond Brex and Ramp, such as Navan, Airbase and Mesh Payments, as well as incumbents such as Bill.com, which also offers a solution pricing.

Specifically, it puts Mercury in even more direct competition with Brex, which also offers bank accounts, corporate cards, bill pay and expense reimbursement. The two companies were among the fintechs that benefited more never Silicon Valley Bank collapsed in 2023 — although it was reported that the Brex growth spurt had it stopped sometime last year.

Although Mercury is known in the startup world, and that’s the group it started out serving, Akhund says startups now make up less than 40% of its customer base as the company has diversified over the years. Other segments it serves are e-commerce, life sciences and investors, among others. Ramp CEO and co-founder Eric Glyman recently told TechCrunch venture-backed startups represents a “minority” of its customer base. Meanwhile, Brex initially focused more on startups before announcing a boost to business and his own foray into software, then a clarification of smaller businessesand then later a renewed commitment to startups.

New workflows

With the advanced bill payment software, customers will be able to pay bills directly from their bank accounts with features like AI populating bill details, duplicate bill detection, and the ability to approve payments from mobile and via Slack.

Previously, Mercury’s business customers could make payments to suppliers and it had pieces of its bill payment functionality for a while, including optical character recognition (OCR) of invoices, “but it didn’t address the fuller bill payment workflow in a way that fully replace third-party bill payment tools for larger customers,” the company said.

Furthermore, The company also now provides accounting automation, including a new NetSuite integration, which will allow things like categorizing and syncing accounts and expenses as they’re launched.

This summer, Mercury will also offer businesses the ability to create professional invoices, allow customers to pay by credit card or directly from their bank (via ACH), and the ability to send automated invoice reminders. They will also be able to set reimbursement policies and track spending.

The new software “includes the ability to establish more granular approval checks and accounting consolidations so that all invoice activity is automatically recorded correctly,” the company told TechCrunch. “So we’re starting with more enterprise resource planning (ERP)-type functionality that builds on the money-flow aspects of bill paying that we already had.”

Access to the new workflows is free until August 1st. After that, the company will offer a variety of paid plans depending on a company’s size and needs — ranging from $35 to $350 per month.

Like other digital banks, Mercury is not the same bank. It provides banking services through partners Choice Financial Group and Evolve Bank & Trust. It started offering a corporate credit card about 18 months ago.

Square alum Dan Kang, who serves as Mercury’s Vice President of Finance, said the types of customers Mercury has make the company ripe for offering additional products.

“It’s not just that people are parking money in Mercury after SVB,” he told TechCrunch, noting that Mercury’s own finance team has beta-tested all the new products. “They actually use that to run their business.”

Expanding into software isn’t the only branching out Mercury has done recently. The startup too recently expanded into personal banking. In addition to interchange fee income and interest margin, Mercury will make money through this new offering by charging users an annual fee of $240 upon first deposit.

All the moves come at an interesting time for Mercury, which made headlines earlier this year for becoming the target of federal scrutiny over its practice of allowing foreign companies to open accounts through one of its partners, Choice Bank, according to a report her The information.