In the latest edition of our Fintech newsletter, we delve into the dynamic world of digital payments. In this rapidly evolving landscape, the digitization of financial services has ushered in a transformative shift, redefining how transactions are conducted. Digital payments have emerged as a game-changer, revolutionizing the way we make online purchases, conduct point-of-sale transactions, and transfer money digitally.
March and April witnessed a flurry of activity in the digital payments space. Major players in the industry have been making significant moves to enhance their services and cater to the evolving needs of consumers and businesses. We’ll explore the launch of new platforms, groundbreaking funding rounds, and strategic partnerships that are driving the growth and adoption of digital payment solutions.
Investment / Partnership Deals
In a significant move towards digital payments innovation, i2c Inc. has recently announced a strategic partnership with Mashreq, a leading financial institution in the UAE. This collaboration aims to provide the rapidly growing fintech industry in the region with advanced digital payment solutions. By leveraging i2c’s agile SaaS platform, Mashreq will be able to offer pioneering payment experiences to consumers, merchants, and fintech clients. The partnership’s plug-and-play program management approach will enable seamless integration of new capabilities, ensuring swift and effortless access. With a focus on unmatched speed, reliability, and security, this partnership seeks to strengthen the fintech ecosystem in the UAE.
BingX and Mercuryo Join Forces for Smarter Digital Payments! BingX, a prominent crypto exchange, has officially announced its strategic collaboration with Mercuryo in the FinTech industry. This partnership aims to revolutionize the global digital payments landscape, offering customers a simplified, secure, and expedient transaction experience. Notably, both companies share a common goal of making payments easy, with BingX focusing on “Trading Made Easy” and Mercuryo on “Business Payments Made Easy.” By combining their strengths, they are poised to turn this vision into reality. A noteworthy advantage of this collaboration is the seamless sharing of KYC tokens, facilitated by the integration of sumsub tokens. This integration will eliminate the need for customers to undergo multiple verifications, enabling them to purchase crypto efficiently. Thanks to the close collaboration between Mercuryo and BingX’s teams, this partnership is set to deliver enhanced convenience and user experience in the digital payments realm.
UK-based fintech payments group, Equals Group, has entered into a conditional contract to acquire Oonex, a renowned payments services provider based in Belgium, in a deal valued at up to £4.1m. Founded in 2012, Oonex holds licenses from the National Bank of Belgium, allowing it to offer financial and payment solutions to businesses and individuals within the European Union and European Economic Area. With a Mastercard principal membership, Oonex currently issues debit cards across the EEA and provides card acquiring services. The company’s SWIFT and SEPA memberships enable seamless global payments, while its direct payment accounts (IBANs) facilitate transactions for firms and individuals worldwide. This strategic acquisition further enhances Equals Group’s presence and capabilities within the fintech industry, positioning them for continued growth and expansion.
Open Payments, a leading Swedish FinTech company, has successfully raised €3m in a growth funding round with Industrifonden, a prominent venture capital fund in Sweden, taking the lead. As one of the top open banking platforms in the Nordics, Open Payments focuses on facilitating B2B transactions. Their innovative platform allows online banking functionality to be seamlessly integrated into customers’ business systems, enabling direct payments to be approved without the need to log into the online bank. By leveraging APIs to connect with commercial banks, Open Payments empowers payments, account reconciliation, and cash management, providing seamless integration into client applications like ERP systems, payment providers, and FinTechs. The company has identified a growing demand from leading accounting and ERP systems, as well as other financial systems, to incorporate secure and reliable Open Banking solutions. With their cutting-edge expertise in this domain, Open Payments is well-positioned to capitalize on vast business opportunities, particularly in the B2B payments sector, and take the lead in the international Open Banking landscape.
India’s leading payments app, PhonePe, continues its successful fundraising streak by securing an additional $200 million from its majority investor, Walmart. This investment comes at a pre-money valuation of $12 billion, further bolstering PhonePe’s position in the market. With the fresh funds, PhonePe has ambitious plans to venture into new business verticals, including insurance, wealth management, lending, stockbroking, shopping, and account aggregators. Additionally, the company aims to expand its Unified Payments Interface (UPI) services in India by introducing innovative products. Established in 2015, PhonePe proudly claims the title of India’s largest payments app, serving a massive user base of over 440 million individuals and merchants across the subcontinent. In addition to its payment services, PhonePe also offers a range of investment and insurance products, providing a comprehensive financial ecosystem to its customers.
Cologne-based fintech NX Technologies has successfully concluded a Series A funding round, securing €11 million. The company, known for its payment management platform bezahl.de, specializes in digital payment processes tailored for the automotive industry. With bezahl.de automating and simplifying the entire receivables process, from payment requests to financial accounting postings, NX Technologies has already set an industry standard, boasting a remarkable 60% market share among the top 100 car dealer groups. This funding round further solidifies their position as the largest provider of modern payment management in the German automotive market, which generates nearly €200 billion in annual revenues. As the automotive industry faces increasing pressure to digitize internal processes, this investment will empower NX Technologies to set a new standard for automated payment management in the European automotive market and expand their embedded finance capabilities.
Web3 payments firm Helio has successfully raised $3.3 million in a seed funding round. Led by Peak and Lightspeed Faction, the round also saw participation from notable investors including RockawayX, Solana Labs, and a group of prominent angel investors. Since its launch in 2022, Helio has processed over $10 million in various payments, including e-commerce, NFT sales, SaaS subscriptions, and content paywalls, serving over 900 merchant customers and 35,000 users. As one of the top 50 DeFi apps across all blockchains, Helio specializes in providing a secure and user-friendly solution for merchants, dApps, and creators to accept instant crypto payments across multiple blockchains such as Solana, Polygon, and Ethereum. The platform’s built-in content paywalling features enable creators, including podcasters, YouTubers, artists, NFT projects, and media platforms, to monetize their content in innovative ways and expand their reach to a broader audience. With the newly raised capital, Helio plans to strengthen its sales and marketing teams to forge strategic partnerships with creator platforms. Additionally, the company aims to expand its engineering team to support its multi-chain strategy, with upcoming launches planned for Bitcoin and Binance. Helio will also introduce an in-app wallet to enhance Web2-style payment experiences and integrations.
Puerto Rico-based digital bank Zenus Bank has made an undisclosed acquisition of payments start-up FUEX Payments. Also operating in Puerto Rico, FUEX Payments specializes in API solutions that facilitate real-time payments for governments, businesses, and financial institutions via global payment card brands. Through this strategic move, Zenus Bank aims to extend its reach into the Caribbean and Latin American markets, enabling businesses and individuals in these regions to transact more efficiently and securely on a global scale. Established in 2019, Zenus Bank empowers customers from developing countries to access, send, receive, and store money in the US, specifically in US dollars, from anywhere around the world. The bank offers additional benefits such as real-time cross-border money transfers, free Zenus-to-Zenus bank account transactions, and the ability to make payments in over 45 global currencies.
Australian FinTech company Till Payments has successfully raised $70 million in a Series D funding round, led by Silva Fortune. The company has experienced remarkable growth with a 300% increase in transaction volumes and a 200% increase in its merchant base over the past year. Till Payments offers comprehensive solutions that empower merchants to accept payments from a wide range of mainstream and emerging payment methods through a single partner. Their fast, secure, and all-in-one payment processing ensures seamless transactions for businesses. Recently, Till Payments expanded its network of payment instruments by adding Australian Payments Plus (EFTPOS), AliPay, and WeChatPay, further enhancing its value proposition to customers worldwide.
Mastercard has joined forces with payment processor PXP Financial and payments infrastructure firm Payall to strengthen cross-border payments. This strategic alliance between the three companies focuses on providing secure, compliant, and efficient solutions for cross-border payments and international money transfers. The collaboration also brings inclusive payment capabilities, empowering PXP Financial’s customers to conveniently and safely send funds to their partners, employees, and suppliers. This partnership reinforces Mastercard’s commitment to enabling seamless and convenient payment experiences across borders, further enhancing global financial connectivity.
Leading global issuer-processor Paymentology has joined forces with Mexico-based financial service provider Fondeadora to bring the convenience of Apple Pay to the region. With the digital economy in Mexico experiencing significant growth post-COVID-19, there is a growing demand for seamless and secure digital payment solutions. Fondeadora’s mobile app empowers individuals and corporate clients to efficiently save, use, and manage their money. Through this strategic partnership, customers can make payments across multiple countries, including Argentina, Colombia, Costa Rica, Brazil, Peru, and any other location worldwide that accepts Apple Pay. By leveraging Paymentology’s cutting-edge payment services, Fondeadora gains access to faster transaction processing, enhanced security measures, and improved data analytics, further enhancing the overall payment experience for their valued customers.
French paytech Ingenico has made a strategic move by acquiring smartphone payment acceptance fintech Phos, further strengthening its position in the market. The acquisition aligns perfectly with Ingenico’s “device agnostic” Payments Platform-as-a-Service (PPaaS) strategy, allowing its merchant clients to seamlessly accept payments directly from NFC-enabled Android devices. Phos brings a range of valuable services to the table, including acquirer integration, certification, app-to-app and web-to-app API-based integrations, as well as a software development kit (SDK) for embedded payment acceptance. This strategic partnership sets the stage for innovative payment solutions and enhanced customer experiences in the future.
Kakao Pay, a global fintech innovator based in Korea, has announced its agreement to purchase a 19.9% stake of Siebert Financial Corp. Additionally, subject to approvals, Kakao Pay will acquire an additional 31.1% of Siebert through newly issued shares. This strategic investment by Kakao Pay, a subsidiary of the conglomerate Kakao Corp., will fuel Siebert’s growth plans, expand its platform, and enhance its distribution capabilities. Leveraging Kakao Pay’s technology expertise in financial services, the partnership aims to strengthen Siebert’s business and growth strategy, while providing an improved user experience and additional benefits for those investing in foreign stocks. With a proven track record in the Korean market since 2014, Kakao Pay brings extensive experience in online/offline payment, money transfer, investing, membership, bill payment, and authentication services. Through its subsidiary, Kakao Pay Securities, the company offers easy access to a diverse range of financial products, including U.S. stock trading with the lowest transaction fee in Korea.
Payments technology developer SKUx has successfully closed its Series A funding round, securing $11m to support the expansion of its product offerings. SKUx is revolutionizing the way consumer payments and incentives are delivered, redeemed, settled, and reported. Through its innovative SKUPay solution, SKUx is transforming item-specific incentives and consumer payments, enabling cost efficiencies, improved data insights, more effective promotions, and an enhanced customer experience. The platform’s capabilities benefit payment networks, retailers, consumer product companies, and end consumers alike. This funding round will provide SKUx with the resources it needs to further scale its operations and continue driving transformative changes in the payments industry. Advection, the investor backing SKUx, is thrilled to support the growth of this game-changing company.
Saudi Arabia’s leading shopping and payments platform, Tamara, has secured a substantial $150m in a receivables warehouse facility from Goldman Sachs. This significant investment will enable Tamara to meet the growing demand for its Buy Now, Pay Later (BNPL) product and expand into new verticals. Launched in 2020, Tamara aims to revolutionize the way people shop, pay, and bank in their daily lives. Its flagship BNPL service allows consumers to conveniently pay for products within 30 days or in three installments over a two-month period. With its user-friendly app and QR code scanning, customers can make payments online or in physical stores. Tamara’s platform has already partnered with over 15,000 merchants, including renowned global brands such as SHEIN, IKEA, Jarir, Noon, and H&M. The company proudly boasts a customer base of six million users across Saudi Arabia, UAE, Kuwait, and Bahrain. This investment from Goldman Sachs will fuel Tamara’s growth and enable it to continue delivering innovative payment solutions to customers across the GCC region.
Singapore-based cross-border payments FinTech company, Thunes, has reportedly secured $30m in an ongoing Series C funding round, with London-based hedge fund Marshall Wace participating as a key investor. While the total size of the funding round and other backers were not disclosed, Thunes is making significant strides in building a global payment infrastructure to enhance payment experiences. Its platform offers seamless integration with APIs, enabling businesses and customers worldwide to send and receive payments effortlessly. Thunes’ comprehensive suite of features includes cross-border payments, business payments, virtual accounts, mass payouts, collections, and a robust business hub. This latest funding injection will support Thunes’ continued growth and advancement as it revolutionizes cross-border payments.
Global payments infrastructure firm, TerraPay, has successfully secured over $100m in its recent Series B equity financing round. The round was led by IFC and backed by notable investors including Prime Ventures, Partech Africa, U.S. International Development Finance Corporation, and a consortium of others. TerraPay is dedicated to advancing financial inclusion and specializes in facilitating secure, cost-effective cross-border remittances and instant money transfers. With this substantial funding, TerraPay aims to expand its global footprint, particularly in the LATAM and MENA regions. It plans to strengthen its existing pay-out network to encompass 150 countries by 2024 and accelerate its growth trajectory. Additionally, TerraPay will invest in marketing initiatives and drive the adoption of alternative payment methods for mobile wallets. The company also intends to enhance its regulatory and compliance infrastructure by pursuing key license applications worldwide.
New product features, highlights & use cases
Egyptian fintech Axis Launches Digital Payments Platform for Egyptian SMEs, Revolutionizing Financial Inclusion! Egyptian fintech Axis has made a significant stride by introducing its digital payments platform, axisPay, to the North African market. Following the attainment of a license from the Central Bank of Egypt (CBE), Axis now offers an open-loop mobile wallet solution designed to address the needs of small businesses and their employees. CEO Marco highlights that small businesses waste an estimated 192 hours annually on cash payments, while setting up bank accounts for streamlined payroll processes proves cumbersome and expensive. Furthermore, employees, many of whom are part of Egypt’s financially excluded population, face challenges related to carrying cash and limited digital payment options. Axis’ platform aims to alleviate these issues by enabling businesses to streamline payments to employees and suppliers through axisPay mobile wallets. With features such as salary disbursement, expense management, cashback rewards, and wage advances, employees gain access to a range of financial services, including fund transfers, bill payments, online shopping, and QR code payments. This milestone represents a significant step toward enhancing financial inclusion and fostering digital convenience for Egyptian SMEs and their workforce.
Paytm, the renowned payments and financial services platform, has made a significant announcement regarding its new technology platform, entirely developed in-house. This upgraded platform is set to enhance Paytm’s already fast, secure, and seamless payment services, offering an unparalleled user experience. According to the company, the advanced platform has the capacity to handle up to 10 times the current scale, empowering Paytm to lead the way in India’s rapidly expanding digital payments landscape. With a robust operational risk system and fraud management built from scratch, Paytm is dedicated to meeting the evolving needs of India’s payments ecosystem. The platform’s scalability ensures it can handle the next wave of growth, setting a gold standard for fintech companies across the nation.
Industry Trends
The Digital Payments market has a global transaction value of US$8,487.9 billion in 2022 and is the largest segment within FinTech. China is currently the biggest market in the world in Digital Payments, with transaction value reaching US$3,496.6 billion in 2022. ~ Statista
According to the FIS Global Payments Report 2023, A2A payments continued their upward trajectory in 2022, fueled by the expansion of real-time payment systems worldwide. With nearly 70 real-time payment schemes in operation, A2A payments accounted for a staggering US$525 billion in global e-commerce transaction value, a notable 13 percent increase from the previous year. This growth can be attributed to the speed, safety, and convenience offered by real-time payment rails, providing consumers with faster and more seamless checkout experiences. A2A payments not only reduce payment acceptance costs compared to cards but also enable instant fund settlement, improving cash flow for businesses. In fact, some merchants are incentivizing customers to choose A2A as their preferred payment method, further propelling its adoption. Moreover, while A2A payments are well-established in business-to-business (B2B) and person-to-person (P2P) contexts, this research highlights their rising prominence in person-to-business (P2B) transactions. By facilitating direct and often instantaneous transfers from consumers’ bank accounts to merchants, A2A payments offer a cost-effective acceptance solution for businesses.