Stripe Acquires Paystack; India's Razorpay Nets $100M & Joins Unicorn Club; Yandex Drops $5.5B Tinkoff Takeover

Hey ?? fellow FinTech enthusiasts! Hope you are all keeping safe during these unprecedented times ????

P.S. Before we dive into what happened in FinTech last week, check out my Premium Connecting the Dots Newsletter, where you will get much more????

Last week (12-16 October) was yet another interesting week in FinTech this year. Stripe is stepping up its expansion into Africa through the acquisition of Lagos-based payments firm Paystack in a deal reportedly worth more than $200 million; Indian payments processor Razorpay has joined the Unicorn ranks after raising $100 million in Series D financing; PayPal is to take on the likes of Klarna and Australia's AfterPay with the launch of a buy now, pay later shopping service that lets UK consumers pay for their purchases in three monthly instalments, and more!

Without further ado, let us dive into what has happened in the financial technology sector this week. Let’s connect the dots.

Stripe Acquires Nigeria's Paystack

Stripe is stepping up its expansion into Africa through the acquisition of Lagos-based payments firm Paystack in a deal reportedly worth more than $200 million.

Like Stripe, Paystack provides APIs that let merchants, with just a few lines of code, build online payment features.

More than 60,000 businesses in Nigeria and Ghana use Paystack to collect online and offline payments. The team has developed APIs enabling developers to create online custom checkout experiences, build automated recurring billing systems, instantly send bulk transfers to any bank account in Nigeria, and verify the identity of customers.

Already processing more than half of all online transactions in Nigeria, the company is planning to expand across the continent and has already started a pilot with businesses in South Africa.

Stripe led an $8 million Series A funding round for Paystack in 2018 and has now decided to buy the Nigerian outfit to take advantage of a market that has huge potential, with online commerce on the continent growing at 21% year-over-year.

Paystack will continue to operate independently. Over time, its capabilities will be embedded in Stripe’s programmable platform for global money movement that currently spans 42 countries.

This acquisition is a strong validation of a huge potential that is currently hidden in Africa, and especially Nigeria.

Indian FinTech Razorpay Nets $100M & Joins Unicorn Club

Indian payments processor Razorpay has joined the Unicorn ranks after raising $100 million in Series D financing.

The funding round was co-led by Singapore’s sovereign wealth fund, GIC, and Sequoia, with participation from existing investors Ribbit Capital, Tiger Global, Y-Combinator and Matrix Partners.

The six-year old company provides businesses with the ability to accept payments across multiple channels, incorporating over 100 payment instruments. Customers include the likes of Facebook, Google and Wikipedia.

Razorpay is currently riding the Coronavirus wave as more businesses switch to digital payments and move online during the pandemic. The company says that two out of three businesses onboarding on Razorpay are accepting digital payments for the first time.

PayPal Enters UK's Buy Now, Pay Later Market

PayPal is to take on the likes of Klarna and Australia's AfterPay with the launch of a buy now, pay later shopping service that lets UK consumers pay for their purchases in three monthly instalments.

Through PayPal Pay in 3, businesses can offer their customers the option of making purchases between ￡45 and ￡2,000 by paying over three, interest-free payments, with seamless automatic re-payments each month. PayPal Pay in 3 will also appear in the customer’s PayPal wallet, so they can manage their payments online or via the PayPal app.

Retailers including Crew Clothing, French Connection, Robert Dyas and Ryman have signed up for the product, which will go live later this month..

The move follows the August release of a 'Pay in 4' product in the US in the lead up to the busiest shopping season of the year.

As online purchases increase and consumers look for more ways to save due to Covid-19, buy-now-pay-later has accelerated in popularity., marking up a 39% year-on-year increase in the proportion of buy now, pay later payments in the UK in 2019. This trend is expected to double by 2023, according to figures from WorldPay.

Rob Harper, UK director of enterprise accounts at PayPal, commented:

During the coronavirus pandemic, we have seen the number of people in the UK shopping online increase dramatically. At the same time, many more consumers are looking to spread the cost of those purchases. We have developed PayPal Pay in 3 to meet that need, building on our heritage as a responsible lender through PayPal Credit, which we launched in the UK in 2014, and has served more than two million customers to date.

Yandex Drops $5.5B Tinkoff Takeover

Russian technology giant Yandex has called off its $5.5 billion takeover of digital bank Tinkoff after failing to agree terms.

Last month, Yandex - often called Russia's Google - made an audacious play to dive into the financial services market, agreeing in principle to buy the country's biggest challenger bank for $5.48 billion in cash and shares.

However, the two firms now says that they have not been able to agree definitive terms. Tinkoff says it "looks forward to continuing to partner with Yandex on current and future projects".

Yandex made the initial move for Tinkoff after a wide-ranging joint venture with state-owned Sberbank ended.

Sberbank has since pivoted to technology, dropping the "bank" from its name and unveiling a host of home electronic devices.

Continue reading on other top stories and get the Weekly FinTech Digest to your inbox every Friday by subscribing to Connecting the Dots Newsletter.

Week in Brief

Stripe is stepping up its expansion into Africa through the acquisition of Lagos-based payments firm Paystack in a deal reportedly worth more than $200 million.

Indian payments processor Razorpay has joined the Unicorn ranks after raising $100 million in Series D financing.

PayPal is to take on the likes of Klarna and Australia's AfterPay with the launch of a buy now, pay later shopping service that lets UK consumers pay for their purchases in three monthly installments.

Russian technology giant Yandex has called off its $5.5 billion takeover of digital bank Tinkoff after failing to agree terms.

??Subscribe?? to my weekly newsletters (followed by ??100,000+?? people) about FinTech and Blockchain & Crypto:

?? Weekly FinTech Digest

?? Weekly Blockchain & Crypto Digest

Also, don't forget to ??subscribe?? to my monthly series and always stay up-to-date:

?? Month in FinTech

?? Month in Blockchain & Crypto

P.S. You might enjoy my earlier pieces as well:

?? These are the Best Performing Stocks of the Last Decade

?? Welcome to the Google Bank - Your Everyday Banking from Google, NOT a Bank.

***

About: I am a business developer, sales professional, FinTech strategist, as well as Cryptocurrency and Blockchain enthusiast. I'm highly passionate about Financial Technology and Digital Innovation, and strongly believe that it will change the world for the better. Apart from my daily job at a global payments startup where I'm leading company's expansion into Europe , I'm an active member of FinTech community and a TechFin evangelist.

If you've enjoyed this piece, don't hesitate to press like, comment what you think and share the article with others. Let's spread the knowledge together!

For more, hit the subscribe button, follow me on LinkedIn & Twitter. I'm building the best community the social world has ever seen!????