In a significant development within Nigeria’s fintech landscape, Bitmama Inc., the blockchain payments platform, has successfully acquired Payday, a virtual card service provider, amplifying its capabilities in the cross-border payments sector.
This strategic move comes hot on the heels of Payday’s $3 million seed round announcement nine months ago and the subsequent confirmation of its exploration of sale options three months before the acquisition. Bitmama’s flagship cross-border payments product, Changera, will now incorporate Payday’s entire customer base, signalling a departure from earlier speculations about a potential acquisition by lead investor Moniepoint.
While specific financial details remain confidential, insider sources indicate that the deal, likely an all-stock transaction valued in the “millions of dollars,” is in its final stages. Launched in 2021, Changera plans to seamlessly integrate key personnel from Payday across various departments, including marketing, customer service, and engineering. This integration is already underway, with Payday employees transitioning to Changera. The involvement of Payday CEO Favour Ori in Bitmama’s team is yet to be confirmed.
Bitmama’s management affirms that Payday’s brand will continue but operate within the broader Changera umbrella, supported by its stablecoin infrastructure. This strategic integration aims to address challenges faced by Payday, including dependence on third-party integrations, to enhance customer experience and service reliability. Payday had previously encountered operational hurdles, such as industry-wide charge-back fraud, disruption in Mastercard services, and the departure of senior team members in July 2023.
For Payday’s 300,000-plus customers transitioning to Changera, immediate changes to fee structures or terms of service are not anticipated in the short term. However, as the integration progresses, customers can look forward to an expanded suite of services and potential new features, capitalizing on the synergies between Bitmama and Payday.
Bitmama acquires Payday as a move to position Bitmama for an ambitious roadmap, notably the development of a groundbreaking solution aimed at enhancing FX transactions for African businesses. This new solution, slated for launch in Q1 2024, addresses a critical market need, facilitating smoother and more efficient B2B cross-border financial interactions.
This strategic acquisition aligns seamlessly with a broader industry trend of consolidations within the fintech space, underscoring Bitmama’s commitment to growth and innovation in the evolving financial technology landscape. Bitmama’s acquisition of Payday signifies a strategic leap forward, strengthening its position in the cross-border payments sector and showcasing the company’s dedication to providing cutting-edge solutions in the dynamic fintech ecosystem.