Zipmark's system works like a digital chequebook. Users connect it to their bank account and then download an app that lets them make payments by creating an electronic representation of a cheque.

The firm's platform accepts payments from any bank, thrift or credit union current account, charging one per cent for each transaction with a cap at $5 regardless of the amount.

The investment round was joined by NYC Seed, High Peaks Venture Capital and the New York City Investment Fund, which helps to run the FinTech Innovation Lab programme.

Zipmark was one of six finalists in the programme last year, enabling it to benefit from exert advice from industry advisers and the chance to show off its technology to the venture community.

Jay Bhattacharya, CEO and co-founder - and a former SVP at Citi Ventures - says: "Our goal is to modernise the chequebook - to reduce the amount of time and money it takes to make a cheque payment, eliminate the possibility for bounced cheques, and take all risk out of the equation for payer and payee alike."

The company claims "overwhelmingly positive" results from a pilot program with New York real estate company Sunshine Suites: after four months, 10% of Sunshine Suites' tenants began paying their bills via Zipmark, significantly reducing payment processing fees for the company.

"Improving the payment and collection process is a huge opportunity for any company that bills its clients, such as real estate managers and utility companies where inefficient collection practices can be detrimental to the bottom line," says Bhattacharya.