GoCardless is finding success in the complex and regulated financial sector, making it Europe’s equivalent of Stripe or Square.

The London-based startup offers a cheaper and easier way for businesses to accept direct debit payments online. It’s designed for merchants who can’t or don’t want to take credit card payments. With GoCardless’s solution, merchants can sign up and start collecting money with fees of just 1 percent.

GoCardless has experienced rapid growth in the past few years by targeting both businesses and consumers. It now claims to be the U.K.’s largest direct debit provider, with Dwolla offering a competing service in the U.S. Off the back of this expansion, it has closed $7 million in funding from some of Europe’s most prominent venture capital firms.

The company was founded by British entrepreneurs Matt Robinson, Hiroki Takeuchi, and Tom Blomfield. The trio had all experienced frustration with both receiving and sending payments. Before launching GoCardless, they shadowed financial institutions to gain insight into the payment mechanisms that underpinned them.

GoCardless makes its money by charging a 1 percent transaction fee, which is still cheaper than most of the alternatives. GoCardless is focusing on direct transfers and helping merchants skip around the system used by American Express, Visa, Mastercard, and others.

“We can do this and still have attractive economics because we’re able to cut out the cost and complexity of the card networks,” the founders explained in a recent Q&A with Wired.

London-based venture firm Balderton Capital led the round with participation from Accel Partners and Passion Capital. GoCardless is an alumni of the competitive accelerator program Y Combinator.