The fintech initiative channels profits from merchant surcharges into reforestation programmes
Eco-fintech TreeCard has raised $23 million to launch a wooden Mastercard debit card for the US market, where it has a waitlist of 250,000 people.
The funding round involved Peter Thiel’s Valar Ventures, World Fund and EQT, Seedcamp, Episode 1 and various angels. The deal highlights increased interest from VC investors in climate-conscious businesses.
As for the previous funding, TreeCard raised $5.1 million last February. Before that, eco-friendly search engine Ecosia bought a 20% stake in TreeCard in 2020.
What TreeCard offers
Beside debit cards made of sustainably sourced wood and recycled plastic bottles, the fintech offers a spending and money management app. It lets users track spending, split bills with friends and monitor how many trees have been planted as a result of their spending. To make it fun, the app includes a game that lets users visualise their individual eco-impact.
The company receives an interchange fee from businesses every time TreeCard customers use their cards. These fees fund planting trees in 35+ countries with local organisations. The startup claims it has already planted more than 200,000 trees this way.
Using the Mastercard network and back-end card processing services from Synapse, TreeCard acts as a fully fledged debit account. It can receive top-ups from regular bank accounts, supports chip and PIN, contactless transactions and mobile payments.
In addition, users can earn a range of environment-friendly rewards. These may include sustainable travel experiences or conscious clothing.
The service has practically no fees for the users (except for the card replacement charge) and offers clients up to 3% of annualized interest on their deposits through third-party vendors.
Although not a bank, TreeCrad partners with Ohio-based Sutton Bank to protect accounts with FDIC insurance. Besides, the company claims customer funds will never be used to fund fossil fuels or deforestation.