Citi Ventures joins $5m round for vehicle payments startup
Written by Hannah McGrath
Citi Ventures has joined a $5 million funding round for Car IQ, a machine commerce startup that allows vehicles to autonomously pay for services.
Car IQ, founded in 2016 by automobile veteran Sterling Pratz, has developed technology to enable cars to connect to a bank’s payment network, which it says will eliminate the need for credit card payments in vehicle service and payment workflows.
The company partners with automobile OEMs (Original Equipment Manufacturers), financial institutions, and third-party service providers so that vehicles in fleets utilizing its technology are able to pay for services rendered autonomously and seamlessly, without human interaction.
The technology is envisaged for widescale rollout in a range of vehicles including car-sharing services, ride sharing platforms, and commercial fleets.
The Series A funding round was led by Quest Venture Partners with participation from new investors Citi Ventures, Avanta Ventures, Alpana Ventures, Plug and Play, and AVG’s Spike Ventures.
Car IQ uses complex sensor data present in every connected vehicle to create a unique “digital vehicle fingerprint.”
This then allows vehicles to directly connect to payment networks, which the firm says enables data governance at the vehicle level, creating integrity and transparency for the vehicle’s transactions, which significantly reduces the risk of fraud.
Vanessa Colella, chief innovation officer of Citi and Head of Citi Ventures said: “The next revolution in payments will be driven by machine banking technology that allows any IoT device, including vehicles, to connect directly to the bank and pay for its own services.”
She added: “Situated at the intersection of two rapidly evolving industries, automotive and financial services, Car IQ is uniquely positioned to enable the next generation of vehicle payments. We are excited to partner with Sterling and his talented team on their next phase of growth.”
Sterling Pratz, founder and chief executive of Car IQ, said: “We believe the future of banking is machine commerce and cars are just the beginning. When vehicles pay for their own services, they eliminate fraud risk, add transparency to the transaction and greatly streamline operations for fleet managers.”