Earlier this month we wrote about the biggest fintech-fintech acquisitions of 2017 so far. Whilst fintechs are continuing to seek collaboration, they’re not the only ones looking to form strategic partnerships and acquisitions. Tier 1 banks and financial services are also eyeing up opportunities to keep up with innovation.
In a recent report by PwC, almost 50% of financial services firms around the world plan to acquire fintech start-ups in the next three to five years. Eight out of ten institutions also foresee partnering with fintechs, peer-to-peer lenders and digital banking platforms to further bolster their dominant presence.
Steve Davies, EMEA Fintech Leader at PwC spoke exclusively to bobsguide: “Over the past couple of years the theme for fintechs was taking over banks, the music has now changed a little bit. There is a much stronger theme both from fintechs and incumbents; The two are now coming to work together.”
Here are some of the most significant bank acquisitions of 2017 so far:
BBVA buys Mexican payments start-up Openpay
BBVA’s Bancomer, the subsidiary arm of the Spanish-bank, acquired Mexico-based payments start-up Openpay to tap into its payment points across the country.
Openpay is a payment service provider that facilitates e-commerce, including on mobile and tablet devices, for both small and large businesses. The Openpay platform uses advanced tools to prevent fraud and has a network of more than 15,000 payment reception points in Mexico. The platform is used by more than 1,000 businesses in Mexico, ranging from start-ups to corporate clients.
Teppo Paavola, General Manager for New Digital Business at BBVA, says: “Openpay is one of the principal innovators in Latin America in payments. Its development platform transforms the manner in which companies can do business online. By leveraging the synergies between Openpay and BBVA Bancomer, we hope to contribute to the growth of electronic commerce."
JPMorgan Chase acquires MCX payments technology
JPMorgan Chase announced the acquisition of payments technology company MCX, the service behind merchant-backed mobile payments CurrentX.
MCX is a QR Code-based mobile wallet with a network of America’s largest retailers, including Walmart, Shell and Phillips 66. The acquisition will lead to an integration of these companies with Chase Pay over the next year.
The motivation of the acquisition by Chase is to expand Chase Pay, the mobile and digital wallet for Chase customers. Although Chase was one of the few major banks that partnered with Apple Pay when the service first launched in 2014, the bank is seeking to grow its reach across popular retailers in the U.S with MCX.
Chase and MCX are also no strangers to one another, with the companies involved in several partnerships over the years. MCX was the premier launch partner for Chase Pay in October 2015.
“When we think about ‘fintech’, we go through a ‘build/buy/partner’ evaluation to decide how we can get to market most efficiently,” sayd Jennifer Roberts, Head of Chase Pay.
“MCX has been an important partner, and their technology complements ours, so we’re thrilled to deepen our relationships with the merchant community through the purchase of this technology,” Roberts added.
Santander acquired Banco Popular for 1Euro
Perhaps not the biggest value acquisition of the year, but significantly one of the most notable acquisition from Santander. The deal made several headlines back in June this year, when the Spanish banking group stepped in to rescue struggling rival Banco Popular Espanol.
The European Central bank said Popular was “likely to fail” due its deteriorating liquidity.
A statement issued by the ECB said: “The significant deterioration of the liquidity situation of the bank in recent days led to a determination that the entity would have, in the near future, been unable to pay its debts or other liabilities as they fell due.
“Consequently, the ECB determined that the bank was failing or likely to fail and duly informed the Single Resolution Board (SRB), which adopted a resolution scheme entailing the sale of Banco Popular Español SA to Banco Santander.”
The acquisition has now completed, and the new company now operates under Banco Santander.
Swedbank acquires PayEx: Amount undisclosed
Swedbank has announced the acquisition of PayEx. The fintech company was a privately-owned group that offers payments solutions for internet, mobile and commerce services that include billing and account management and loans.
PayEx will be a full subsidiary of Swedbank with the headquarters based in Visby, Sweden. The company was founded in 1972 by Max Hansson, and processes more than $28.2bn per year in its home markets of Sweden, Norway, Denmark and Finland.
Birgitte Bonnesen, President and CEO at Swedbank, says within PayEx there is “great competence and knowledge.”