Axle Automation Raises $2.5 Million to Grow AI-Powered AML/KYC Solutions

Axle Automation raised $2.5 million in a seed funding round to grow its artificial intelligence (AI)-powered anti-money laundering and know your customer (AML/KYC) solutions.

The company will use the new funding to scale its team and deliver its solutions to more FinTechs, banks and other financial institutions, according to a July 29 press release.

“This investment not only validates the pressing need for innovation in AML compliance but also propels us closer to our vision of a world where humans work alongside AI agents to eliminate financial crime,” Ioannis Giannaros, CEO and co-founder of Axle Automation, said in the release.

Axle leverages generative AI to automate enhanced due diligence and other processes that are currently highly manual and inefficient, according to the release.

The company’s solutions enable financial institutions to scale their compliance efforts; reduce fraud, compliance risks and operational costs; and increase revenue, the release said.

These solutions arrive at a time when the amount of money spent on AML compliance is growing by 20% a year, surpassing $200 billion, and the amount of money laundered is estimated to be as much as $2 trillion a year, per the release.

In meeting these challenges, Axle Automation aims to become “the market leader for AI-powered compliance,” Ken Nguyen, partner at Diagram Ventures, which led the company’s seed funding round, said in the release.

“Axle’s innovative approach to automating compliance workflows aligns perfectly with our goal of leveraging transformative technologies to drive positive impact,” Nguyen said.

PYMNTS Intelligence has found that 71% of financial institutions now use both AI and machine learning (ML) in their fraud-fighting efforts.

All 10 North American financial institutions that were surveyed said they rely on a mix of in-house fraud prevention systems, third-party resources and new technologies to protect their institutions and customers, according to the PYMNTS Intelligence and Hawk collaboration, “Financial Institutions Revamping Technologies to Fight Financial Crime.”

On Wednesday (July 31), Hawk expanded its Series B funding amid a new investing partnership with Macquarie Capital, saying the funding will drive the international expansion efforts for its fraud prevention and AML technology using AI.