FFG acquires payment gateway with $380m annual transactions – as key next step for BNPL expansion
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The deal is evidence of the FFG executive team’s ability to pursue a growth-by-acquisition strategy in the space.
Tech venture firm FatFish Group (ASX:FFG) has been busy on the M&A trail lately, as it builds out a market-leading distribution footprint for its BNPL service in south-east Asia.
And the company announced its latest deal this morning, with the acquisition of a strategic 55 per cent stake in Malaysia-based payments company Pay Direct Technology.
Consideration for the deal will be $RM1.5m (~$470,000) in cash, which will be funded out of FFG’s existing working capital.
It follows on from the recent acquisition of consumer finance platform Forever Pay, which is also based in Malaysia and holds a lending licence from Malaysia’s Ministry of Housing and Local Government.
Each new acquisition is in line with FFG’s broader strategy to execute on the lucrative market opportunity for BNPL services in south-east Asia, which boasts a huge population and rapid growth rates for fintech adoption.
With its controlling stake in Pay Direct, FFG will leverage the company’s QlicknPay platform – a payment gateway solution that allows financial institutions to onboard new merchants for accepting online payments.
Pay Direct serves a tier one client base which includes the two largest banks in Malaysia – Maybank and OCBC Bank.
Its broader customer base now numbers more than 500 companies, including Wise (formerly Transferwise) and TeaLive (Southeast Asia’s largest lifestyle tea brand)
The company processes over $30m of transactions per month, and is certified to process payments through Visa, Mastercard, PayPal and FPX – the domestic network backed by Malaysia’s central bank.
Since being founded in 2017, the popularity of the QlicknPay service drove strong early adoption and in 2020, it booked monthly growth in payment processing volume of more than 40 per cent.
With its latest acquisition, FFG is now putting together a connected network of companies with complementary service offerings as it pursues a pan-regional BNPL growth strategy.
The Pay Direct deal is the latest example of the FFG executive team’s ability to target acquisitions that give it the necessary tools – proprietary technology and licensing requirements – as it scales up for growth in the region.
This article was developed in collaboration with FatFish 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.