Fintech unicorn Nium in all share deal to acquire  alternative payments network platform, Socash

• Combines Socash’s tech for local payment with Nium’s global platform
• Can offer lower-cost payment processing alternative for digital merchants

Confirming media reports that began in mid-February about a possible acquisition, Singapore based fintech unicorn Nium, which describes itself as a global platform for modern money movement, announced on 26 April its agreement to acquire Socash Pte Ltd, a Singapore alternative payments network focused on non-traditional physical outlets.

Socash brings together financial institutions and digital commerce merchants into a network that allows consumers to deposit, withdraw, and make payments with cash from more than 30,000 local shops, cafes, and grocery stores.

The acquisition provides Nium with the team and technology to enable multiple forms of local payment acceptance for digital commerce, especially in emerging markets, the company said. With cash still a preferred method of payment across the Asia Pacific and Latin American markets, the acquisition of Socash allows Nium to accept cash for transactions online – bridging the physical and digital worlds. According to Nium, combining the capabilities of both organisations allows them to become a full-stack, platform-of-choice for global merchants with capabilities for local acceptance, multicurrency accounts, foreign exchange, and global payouts.

The acquisition is expected to close in Q3 2022, subject to customary regulatory closing conditions.

While Nium’s release did not mention it, Deal Street Asia has reported that the acquisition will be an all share deal. Nium reached unicorn status in July 2021 when it issued a statement announcing it had raised over US$200 million in its Series D at a valuation in excess of US$1 billion.  Socash has raised a total US$7 million of which US$6 million came in its 2019 Series B raise.  

“The Socash team has built an impressive platform that bridges payments in the digital space with payouts in the physical world,” said Pratik Gandhi, Co-founder and COO of Nium (pic). “When compared to current in-app payment costs, we estimate Socash saves up to 30% in commissions paid. With this acquisition, Nium can offer a lower-cost payment processing alternative for digital merchants, spanning local payment acceptance through to global payouts.”

Alternative payment methods (APMs), including e-wallets, real-time bank transfers, and electronic cash have seen a surge in growth globally as an easier way to transact online. According to the World Bank, 45% of global consumers already use a mobile wallet, versus 18% of consumers who rely on credit cards for payments – online and offline. Cash acceptance for online transactions, from bill payment to in-app purchases, is still a popular use case, especially for 1.7 billion people who the World Bank estimates remain unbanked. This acquisition makes for a more inclusive financial system, where global consumers are given the power to pay as they choose.