10 Biggest Fintech Acquisitions
The fintech industry has grown leaps and bounds over the past few years. There have been uncountable instances of incredible innovations that have completely disrupted traditional financial systems. Currently, there are many thousands of fintech companies operating in this sector. America alone boasts more than 12,000 fintechs, making it the highest fintech number in the world. EMEA has reported close to 10,000, and the Asia Pacific region has around 7,000 companies successfully operating in the fintech space. The numbers are increasing continually by bringing newer advancements and innovations to the incredible fintech league.
The fintech industry has led to a massive revolution worldwide, owing to its tremendous scope. With such an astronomical increase in valuation and numbers, the level of competition has shot up like never before. New startups are readily challenging the banking behemoths. The upheaval has led to many companies forming alliances to build on each others’ strengths and to cut down on the competition.
There have been some massive merger and acquisition deals in the fintech industry. 2021 saw tremendous changes, and contrary to general expectations, the year saw the highest number of fintech exits. With such close-neck, intense competition, companies globally have borne the brunt, resulting in cross-border mergers and acquisitions.
Some of the biggest mergers and acquisitions are mentioned below.
Square and Afterpay
In August 2021, Square announced its plans to acquire Afterpay in an all-stock deal set at $29 billion. Afterpay is an Australian Buy Now, Pay Later (BNPL) firm. The BNPL sector in fintech is one of the most successful sectors that has disrupted the credit market. Square is an American payment tech company headquartered in San Francisco that has closed the deal intending to acquire Afterpay, whose sales crossed $4 billion at the beginning of 2021.
PayPal and Paidy
PayPal is one of the leading fintechs in the world that has achieved a native status in many countries. Paidy is a Japanese BNPL service provider valued at over $1 billion. BNPL has been a lucrative sector in the fintech space that has earned immense attention. With its massive growth in 2021 alone, it is no wonder that fintech leaders like PayPal are eyeing already established BNPL providers to expand their businesses. The deal between the two companies was agreed at $2.7 billion.
Visa and Tink
Visa is one of the oldest fintech leaders in the world. Tink is a European open-banking platform that has provided its cloud-based technologies to almost 3,400 banks. In March 2022, Visa completed Tink’s acquisition by paying $2.5 billion.
Mastercard and Aiia
In September 2021, MasterCard signed an agreement with Aiia. MasterCard is a well-known fintech giant, and Aiia is an open banking service provider based in Denmark, catering to the European market. MasterCard aims to expand into open banking by tying up with Aiia.
Bill.com and Divvy
Bill.com is a cloud-based money management platform that necessitates easy creation of bills, completion of e-payments, and receipt of invoices and payments. Divvy provides expense management services to businesses. Bill.com’s acquisition of Divvy has strategically reinforced its position as the leading expense management provider.
PayU and BillDesk
BillDesk, an Indian fintech leader, has been acquired by PayU, the payments, and fintech provider of the parent, Prosus. The acquisition amounted to $4.7 billion. Prosus’s aim in acquiring BillDesk is to combine the fintech services of PayU and BillDesk and pave the way to reach BillDesk’s humungous customer base.
Klarna and Stocard
Going against the currents, the leading BNPL provider Klarna has acquired Stocard, a German fintech that offers payment aggregation and payment services. Stocard’s customer base is over 60 million consumers giving Klarna a strategic edge over other mobile e-wallets, payments, and BNPL service providers.
Broadridge Financial Solutions and Itiviti
In May 2021, the leading financial services provider Broadbridge acquired Itiviti. Itiviti is a leading technology provider based out of Stockholm that aims to promote connectivity and related solutions across the global capital markets. The acquisition deal was agreed at $2.5 billion.
NatWest and RoosterMoney
One of the leading banks NatWest acquired RoosterMoney, a British fintech. RoosterMoney caters to a slightly different clientele which comprises children and their parents. The application provides e-wallets that allow parents to allocate allowances to their children based on the chores they complete. The focus of RoosterMoney is to help children gain essential monetary lessons at a young age by providing an incredible platform. NatWest’s acquisition of RoosterMoney has been one of the wisest decisions.
NCR and Cardtronics
NCR Corporation won the bid for the acquisition of Cardtronics, a non-bank ATM provider that has more than 285,000 ATMs in 10 countries. NCR is one of the biggest technology providers for different enterprises, such as banks, retailers, restaurants, etc. NCR’s move to acquire Cardtronics’ technological capabilities has provided strategic leverage in the fintech sector.
These are some of the biggest acquisitions that have taken place over the last year. There has been an immense rise in the number of acquisitions and mergers taking place in the fintech spectrum in recent years.
