Dwolla says the cash will be used to double its workforce in Iowa and New York and open a new office in San Francisco. "Product, marketing, and business development are the initial focuses," says Dwolla founder Ben Milne.

Dwolla's ambition is to build a scalable, global payment network capable of taking on national automated clearing houses and card schemes.

Dwolla is already being used by the state of Iowa to process taxes and the company has secured alliances with banks and credit unions for its FiSync real-time money transfer system.

Dwolla operates a 'flat fee or free' pricing model, with a 25 cent transaction charge kicking in for payments over $10.

Scott Weiss of Andreesen Horowitz compares Dwolla's vision to the expensive proprietary architectures currently used, both in the US and abroad.

"These slow-moving, expensive, fraud proliferating systems aren't just the United States' burden. In many countries around the world, the luxury of ATMs, having cash on hand, or retaining the value of money as it moves from one person to the next, just isn't possible. In many developing areas, networks charge up to 30 percent of a transaction because of the way you paid for a particular good or service," he says. "The world needs a better way to transfer value, the same way it needed a better way to transfer information before the Internet went mainstream. Ben and his team are introducing an entirely new way to think, access, and use money. I am excited to be joining Dwolla's board of directors and look forward to helping Ben build the next multi-billion dollar payment company."