Nigerian Blockchain payments platform, Bitmama Inc. has confirmed the acquisition of PayDay, a virtual card service provider.
This is a significant development in Nigeria’s fintech ecosystem.
The acquisition was Facilitated through Bitmama’s cross-border payments product Changera.
According to reports, Changera is set to acquire 100% of Payday’s customer base to consolidate its blockchain payment platform.
Sources hint that the acquisition conversations have only gone on for a few weeks, and the process is “about 85% complete.”
Changera, according to reports, will also absorb a number of Payday’s key personnel across various departments.
These will include marketing, customer service, and engineering. Some Payday employees are already transitioning to Changera.
However, Payday’s CEO Favor Oris will most likely step away as Bitmamahas already has an established leadership and a strong technical team.
A senior member of Bitama’s management said Payday’s brand will continue to operate. It will however now be under the broader management of Changera, supported by its stablecoin infrastructure.
There are also no planned changes to the fee structures or terms of service for Payday customers.
With these arrangements, it is anticipated that PayDay’s over 300,000 customers will be gently eased into the new management of Changera without much noticeable changes.
However, as the integration progresses, customers can expect an expanded suite of services and potentially new features that leverage the combined strengths of Bitmama and Payday
Changera’s customers can also expect a wider range of available services, including access to Payday’s digital payment solutions.
This integration is expected to overcome the liabilities and challenges that Payday faced due to its dependence on third-party integrations
Payday announced its $3million seed round funding 9 months ago and confirmed its exploration of sale options 3 months ago .
However, the fintech startup had previously had to deal with operational challenges.
Top on the list would be the general industry-wide – charge- back fraud issues , and a disruption in Mastercard services.
The exit of senior team members Bitmama set to in July 2023 was also a major event the company had to grapple with.
Bitmama’s acquisition of Payday highlights a trend of strategic consolidations within the Nigerian fintech industry.
A similar acquisition is Risevest acquiring Chaka in September .
This trend of acquisitions and consolidations can be a pointer to an emerging fintech ecosystem where companies are increasingly seeking strategic partnerships and acquisitions to overcome market challenges and scale operations.