Card giant firm, Visa is set to acquire Tink, the Swedish open banking platform, in a deal worth €1.8 billion (roughly $2.15 billion).
The news comes less than six months after the termination of Visa’s planned $5.3 billion acquisition of Plaid, the San Francisco-based fintech firm – a deal that had encountered significant opposition from the U.S. Department of Justice.
Like Plaid, Tink’s platform allows customers to connect with more than 3,400 banks and financial institutions to access aggregated financial data, helping them to build innovative personal finance tools.
“Visa is committed to doing all we can to foster innovation and empower consumers in support of Europe’s open banking goals,” said Al Kelly, CEO and chairman of Visa. “By bringing together Visa’s network of networks and Tink’s open banking capabilities we will deliver increased value to European consumers and businesses with tools to make their financial lives more simple, reliable and secure.”
As part of the Visa deal, Tink will retain its brand and current management team, as well as its headquarters in Stockholm, Sweden.
Tink last raised money in December 2020, when it secured €85 million (roughly $101.5 million) in a round led by Dawn Capital and Eurazeo Growth.
The €1.8 billion transactions, which includes cash and retention incentives, are subject to approval from regulators. Visa will fund the transaction in cash.
Tink’s business model is in part enabled by the EU’s Revised Payment Services Directive (PSD2), which was put into effect in January 2018. The legislation requires banks to give third parties access to the customer data they store, with the aim of driving competition and innovation in financial services.
But the PSD2 framework also paved the way for new payment functionality that allows consumers to make payments directly from their bank accounts without having to rely on intermediaries, like card networks.
In recent months, account-to-account payments have garnered a lot of attention from crypto startups, which see it as a potentially cheaper and easier method of funding wallets.
15-Month-Old P2P Credit Fintech, P2vest Celebrates 100,000 Users
P2vest, a peer-to-peer lending platform by P2vest Technology Limited, has commemorated gaining 100,000 users on its platform since its launch in 2020.
With a mission to transform the way people access credit and lend money by bringing borrowers and lenders together, the platform states that it allows for quick loan disbursement and a flexible payback plan, safer than offers received from loan sharks.
Cash-strapped borrowers for a while now in Nigeria, have been at the mercy of lenders who use unscrupulous means to recover loans. These lenders who conduct their businesses unprofessionally go as far as marring the integrity and characters of the borrowers and their innocent guarantors.
Promising to provide a better approach to lending and borrowing within peers through the utilization of artificial intelligence, the Founder and CEO of P2vest Technology, Mr Austin Abolusoro says that, ”Our goal at P2vest is to build a platform that delivers on ease of access to credit while also building a credit history. Our approach is different, we are using Artificial Intelligence to ensure credit-worthy Nigerians have access to quick loans.”
According to Abolusoro, the 15-month old financial technology company bridged the gap of loan access by connecting authorised lenders with borrowers, while helping them take control of their debt, grow their businesses, and invest for the future.
“Since we launched (in 2020), we have provided access to quick loans to over 105,000 Nigerians. This is a big achievement for us as we have availed people the chance to access loans for their different needs like setting up of businesses, house renovations, Car loans, paying rent, school loan, medical bills on the platform faster and without delay. While also creating an opportunity for people to borrow more as long as they continue to pay back,” he said.
Speaking on its mode of operation, the company states that it uses the Sharing Economy Technology. The sharing economy technology is a new model of consumption, sharing, collaboration between individuals of goods, services, resources, with or without monetary exchanges via dedicated platforms.
The adoption of the sharing economy technology and its model has allowed the fintech credit world to develop over the years. Its growth now creates room for P2P economy to thrive as they cut out the role of third parties.
On the P2vest platform, users are encouraged to grow their money by “becoming a lender on our easy-to-use platform. Give out loans tailored to you and your income, and earn attractive returns.” Borrowers on the other hand are to provide their accurate info, including bank details, where payments of loan, when due are automatically withdrawn from the accounts.
African Startups Secured $4.69 Billion Funding In 2021 – African Investment Report
African Investment Report released by Briter Bridges showed that African Startups secured $4.69 billion in estimated funding in 2021, out of which $4.65 billion was disclosed and $300 million undisclosed (not comprehensive, based on data provided by investors to Briter Intelligence).
Dario Giuliani, director of Briter Bridges said, “As the world learns to integrate COVID-19 into daily routine, work is retrieving as usual and interest in harnessing the business potential in Africa proves to be stronger and more intentional than it’s been in the past.
“2021 was a year of recognition, where the newly-available resources and the increasing number of international investors shifting mandates to include Africa met hundreds of promising entrepreneurs to support”.
“Approaching $5 billion in known funding in 2021, especially after nearly twenty-four months since COVID-19 pandemic began is a clear sign that Africa is undergoing tangible changes and the increasing presence of local exits and returns is shaping the continent’s attractiveness”. He added.
The top 4 African countries where the startup funding was focused are, Nigeria, South Africa, Kenya and Egypt.
The report further revealed that financial technology companies captured the largest share of funding on the African continent, gulping 62 percent of the total funding. Breaking down the funding into sectors, Health and Biotech secured 8 percent of the funding, 7 percent to Logistics, 5 percent to Education, 4 percent to Cleantech, 4 percent to Agriculture, 3 percent to E-commerce, 3 percent to Mobility and 2 percent to Data and Analytics.
In 2021, 13 companies raised $100 million in a single round. Some of the companies are Opay, Chipper, Flutterwave, Andela, and others. The report also showed that debt financing companies captured 6 percent of total disclosed funding in 2021.
Africa’s startup Merger and Acquisition market also recorded significant growth in 2021. The African Investment Report showed that 33 acquisition was recorded in 2021 compared to 17 acquisition deals reported in 2020.
The report further revealed that a large sum of the fund disbursed in Africa’s market is from the United States and the United Kingdom. The United States accounts for 62.5 percent of the fund, 7.5 percent from the United Kingdom, 6 percent from South Africa, 4 percent from Canada and 20 percent from others.
The report stated, “the growing investment appetite towards Africa’s entrepreneurs has resulted in the rise of corporate venture funds and corporate innovation initiatives interested in harnessing the skills, networks and technologies developed by local companies in a variety of sectors”.
Mobile Payments in sub-Saharan Africa Are Predicted to Grow by Over 60% in the Next 5 Years
The total value of mobile money transactions in emerging markets is predicted to exceed $870 billion in 2026; this growth tendency can also be seen in sub-Saharan Africa, where mobile payments are expected to grow by over 60% in the next 5 years. Seen as one of prominent payment trends in emerging markets for 2022, the popularity of mobile payments is emphasizing the importance of Local Payment Methods, and could open up the African market to a number of global e-commerce opportunities.
Mobile payments as a Local Payment Method (LPM) appeared in the sub-Saharan region in the early 2000s with Safaricom, a Kenyan mobile network operator, offering one of the first mobile payment solutions. The importance of this LPM only grew with new players and more regional countries entering the space. While mobile payments were not automatically available to each sub-Saharan country, as some still lacked technical solutions, it has become a widely spread trend that continues appearing in more African countries.
Frank Breuss, CEO of Nikulipe, a Fintech company creating and connecting Local Payment Methods to access Emerging and Fast-Growing Markets, notes that this payment trend has grown popular due to the particular circumstances sub-Saharan Africa is in.
“More than half of the African population remains without a traditional bank account even today, so solutions like mobile payments are most convenient for the region,” explains Breuss. “Mobile phones are widely available across the region, making mobile money payments the primary way for Africans to pay for goods and services like groceries, food delivery or taxi rides, or even utility bills.”
Breuss continues, adding that mobile phones in Africa are used in a very different way than they are in the US or Europe; they are often not based on monthly subscription models, but rather balances are topped up by purchasing prepaid airtime credits, that can be purchased at thousands of shops or agent-kiosks even in the most rural areas.
“This allows people, even those without a bank account or a credit card, to buy phone credits not just to make calls, but also to top-up their phone to pay local merchants for goods and services—logistically, it’s the simplest and most convenient LPM to use. Knowing all of this, understanding why mobile payments are popular in this region can, in turn, open up more global e-commerce opportunities for both international merchants and African shoppers, looking to shop more globally.”
Since much of Africa’s population has limited access to financial services, the continent is regarded as one of the world’s most attractive banking opportunities for developing the existing financial industry and introducing new products to improve financial accessibility. After previously disregarding mobile money’s target market in favor of Africans with higher income, Africa’s traditional banks are, too, looking into entering telecommunications territory. This move by local banking institutions indicates that the mobile payments market will continue growing in the upcoming years.
While mobile payment penetration varies from one sub-Saharan African country to another, at the end of 2020, 495 million people were using mobile services, which represents 46% of the region’s population. It is predicted that by 2025 this number will reach 615 million—equivalent to 50% of the region’s population. This shows that Local Payment Methods will remain an important part of not only sub-Saharan Africa’s but also fast-growing and emerging markets e-commerce growth.
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