Competition is heating up in the payment services space after a year of substantial capital investment for upcoming fintechs including DataMesh, Airwallex, Till Payments and Fin-Pay. 

Following the historic takeover of Afterpay by US-giant Square (ASX:SQ2), venture capital interest for Australian back-end payment service fintechs has picked up as merchants and consumers demand more innovative solutions that encompass crypto, QR codes and BNPL payment infrastructure.

While tech stocks have taken a battering in recent months, back-end payments companies are still seeing growth with Novatti (ASX:NOV) reaching a $10 million quarterly revenue milestone for the first time following its acquisition of ATX. Confidence in unlisted fintechs also remains high with cross-border payments provider and global unicorn Airwallex raising $137 million, less than two months after a fresh $275 million and Sydney based DataMesh locking in $12 million in a pre-series round featuring NAB Ventures, ahead of an expected $100 million raise later in the year.

Seismic shift

It’s all part of a broader movement accelerated by digitisation post-COVID, says DataMesh CEO, Mark Nagy.

“This fintech revolution spurred on by COVID has created a seismic shift in the way the financial world operates. Consumers and merchants are yearning to tap into innovative payment solutions and offer better in-store experiences, the issue is legacy systems are slowing them down. Building a solution that solves this fundamental problem and provides stability for banks and merchants while continuing to offer choice to customers is the final piece in the puzzle and something we’re very proud of offering at DataMesh.”

DataMesh, a new player in the fintech ecosystem delivers next generation, fully integrated payment capabilities as well as a suite of unique, valuable customer insights and integration tools through its proprietary EMV compliant financial switching platform (UnifyTM).

Crypto going mainstream

DataMesh recently grabbed headlines for its partnership with crypto.com and Adelaide based retail group Peregrine Corporation, offering customers at Peregrine owned service stations the ability to pay for fuel and groceries using cryptocurrencies in store.

Online payments via crypto are becoming more frequent, with Novatti Group initiating a project to develop Australia’s first Visa-powered crypto payment card through Cryptospend. However, it is believed the real-time in store payments for Peregrine service stations developed by DataMesh will be a world first, filling the gap between crypto investment and real world application.

The success of the program will be followed closely by investors bullish on crypto and keen to see applications that increase its stability.

This article was developed in collaboration with DataMesh Group, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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