Billing the deal as the largest single round of financing in the fintech space to date, the new funding will further propel San Francisco-based SoFi's growth as an alternative to traditional bank lending.

Existing investors participating in the round include Third Point Ventures and affiliates of Third Point LLC, Wellington Management Company LLP, Institutional Venture Partners (IVP), RenRen, Baseline Ventures, DCM Ventures and others.

The Series E round brings total equity investment in four-year old SoFi to $1.42 billion.

The firm, which has been profitable since 2014, was the first company to enable graduates to consolidate and refinance their federal and private student loans. Since that time, the company has expanded its offerings to include mortgages, mortgage refinancing, and personal loans. It has so far funded more than $4 billion in loans to date and is expected to surpass $6 billion in funded loans by the end of 2015.

Mike Cagney, SoFi CEO and co-founder, says: “This funding will dramatically advance expansion of our disruptive products and experiences, and in turn, meaningfully benefit financially responsible individuals. Our trajectory is clear: we are well on our way to becoming the most trusted financial services partner in the US."

SoFi currently has more than 400 full-time employees and expects to add at least 100 more by year-end. To house its burgeoning sales, servicing and underwriting teams, Cagney says SoFi will double its office space in Healdsburg, California to 20,000 sq feet and expand its 50-strong engineering office in Helena, Montana, along with its offices in Washington, DC and Frisco, Texas.

For SoftBank, the deal marks its entry into the booming fintech investment arena.

Nikesh Arora, resident & COO of SoftBank says the firm seeks to invest in large industries or geographies that are "ripe for change".

“This investment gives SoftBank exposure to the financial services sector, which is one of the largest and most important industries in the world," he says. "SoFi is clearly a game changer in the fintech space."