According to TechCrunch, Stripe has raised $20 million in a round led by General Catalyst with existing investors Sequoia, PayPal co-founder Peter Thiel and Elad Gil.

The company provides merchants with an API that they can embed into their Web sites to easily accept credit card payments. Users don't need merchant accounts and can set up their own payment forms without having to worry about PCI compliance requirements. Firms pay 2.9% plus 30 cents per successful transaction.

Stipe claims thousands of sites, including foursquare and shopify, already use its technology and according to the breathless TechCrunch article, some major -e-commerce firms are set to come on board while the latest funding values the firm at up to $500 million.

Meanwhile, mobile payments start-up Paydiant has raised $12 million in its own series b funding round led by Stage 1 Ventures. Paydiant, which raised $7.6 million in February, sells banks, retailers and processors white-label API-based contactless mobile wallets. According to VentureBeat, the firm is already trialling its technology with 15 banks and will now start work with retail partners.

Finextra Verdict: The global economy may be in the doldrums, but there is plenty of VC cash swilling around for innovative payments players. Despite competing with PayPal, Stripe so far has secured funding from three out of five Paypal co-founders. Visa, MasterCard and AmEx have also boarded the gravy train to one degree or another, viewing investments in firms like Square and Fundamo as a competitive hedge against the threat posed from the disruptive economics of online and mobile shoppping. With a few minor exceptions, such as JPMorgan Chase's recent investment in m-commerce start-up GoPago, banks have been slow to react, watching from the sidelines as new players stake out claims on their core payments territory. Maybe it's time to fight back. A collaborative, bank-backed VC fund would be a start. Any takers?