Nium’s co-founder and CEO Prajit Nanu
Nium, a leading cross-border payments company with significant operations in Southeast Asia, announced today it has signed a definitive agreement to acquire Wirecard Forex India, a foreign currency exchange, pre-paid card, and remittance services provider.
Wirecard Forex India is a unit of German fintech giant Wirecard Sales International Holding GmbH, which hit the headlines last year after it filed for insolvency in June 2020 due to one of the biggest accounting scandals in modern European history.
The acquisition includes Wirecard’s Authorised Category II Money Exchange Dealer (AD II) licence issued by India’s central bank, the RBI. With this license, Nium can directly engage in a variety of payment services activities across the subcontinent, including currency conversion, money transfer, and pre-paid card issuance.
The financial terms of the transaction were not disclosed.
This deal, Nium’s second in just over a month after its acquisition of Ixaris, is expected to close in Q3 2021, subject to customary closing conditions, including approval by the local banking control authority.
Post-acquisition, all of the 190 employees of Wirecard Forex — which has 23 branch locations across India — will join Nium.
Also Read: Digital remittance startup InstaReM rebrands into Nium, offering global enterprise payments platform
“We’re seeing an accelerated move to digital payments as companies modernise their infrastructure to capitalise on the post-COVID economic recovery,” said Prajit Nanu, Nium’s co-founder and CEO. “More companies are turning to our global payments stack to embed financial services quickly. This acquisition broadens our licensing portfolio, extends the suite of digital payments services we can offer in India, and provides us with a physical footprint to provide more support in metro areas.”
Founded in 2014, Nium (earlier known as InstaReM), is a global payments platform to enable businesses to send, spend, and receive money from around the world, in addition to empowering them to develop their own products that simplify cross-border payments.
The firm claims it issues approximately 30 million physical and virtual cards today and is licensed in 11 jurisdictions, including direct card issuing capabilities in 24 countries and in 40 currencies.
The company is regulated in the US, the European Union, Singapore, Canada, Hong Kong, India, Australia, and Malaysia.
Nium is backed by the likes of Vertex Growth Fund (Singapore), MDI Ventures (Indonesia), Beacon Venture Capital (Thailand), GSR Ventures, Rocket Internet, and SBI-FMO Fund.
This Wirecard India acquisition comes at a time when the country’s prepaid card market is expected to boom at CAGR of 40.5 per cent between 2021 and 2026. Driving this growth is an expected increase in adoption by businesses looking for fast and easy payment processing, payment flexibility, and elimination of delays related to reimbursements.
As consumer spending returns post-COVID-19, gift cards, meal cards, travel cards, and payday cards will become increasingly popular with businesses and consumers.
“Nium continues to expand its global operations through strategic acquisitions,” added Pratik Gandhi, Nium’s Chief Operating Officer. “Wirecard Forex has extensive reach throughout India and will enable us to deliver next-generation payment services across all major metropolitan cities.”
Founded in 1999, Wirecard offered electronic payment transaction services, risk management, and physical and virtual cards. The firm, which was once valued US$42 billion, collapsed on June 25, 2020, owing creditors approximately US$4 billion after disclosing a gaping hole in its books. According to Wirecard’s then auditor EY, it was the result of a sophisticated global fraud. Reports said quoting German law agencies that fintech giant had been manipulating balance statements to boost sales earnings at least since the end of 2015.
Although Wirecard said the missing money had been sent to two banks in the Philippines, this claim was refuted by both the banks as well as the Philippines’s central bank. Its then CEO Markus Braun was arrested and is currently being investigated.
Over the past few months, Wirecard sold many of its subsidaries, including in Australia, Hong Kong, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam following its insolvency proceedings.
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Image Credit: Nium
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