Leading Fintech Company GoCardless Considering Merger and Acquisition Deals to Bolster Market Share
In a highly competitive field, British fintech company GoCardless aims to secure its position through potential mergers and acquisitions. Hiroki Takeuchi, GoCardless’ CEO, disclosed in an interview with CNBC that the company is exploring opportunities to accelerate growth, add value to its core payment platform, and strengthen its open banking proposition.
Last year, GoCardless made its first major acquisition by acquiring the Latvian open banking startup Nordigen, aimed at expanding access to bank account information for its 85,000 global customers. Takeuchi expressed openness to more mergers and acquisitions, citing the potential for consolidation in the industry.
The company, founded by former Monzo co-founder Hiroki Takeuchi in 2011, processes over $30 billion of payments across more than 30 countries annually. The British fintech industry, despite recent setbacks, remains influential globally, holding the position as the second-largest market for fintech “unicorns.”
Market conditions have shifted in the past 18 to 24 months, prompting GoCardless to focus on strengthening its key offerings and driving business growth. The company has also received keen interest from payment service providers to enhance their direct debit capabilities.
However, GoCardless reported a revenue of £70.4 million ($85.9 million) in the fiscal year ending 2022, with a loss of £62.7 million, marking a 38% increase from the previous year. This indicates the challenges and financial pressures faced by companies in the industry.
The integration with Nordigen is reportedly going well, as GoCardless plans to leverage Nordigen’s technology to offer variable recurring payments, a type of payment similar to direct debit. The concept aligns with the increasing demand for more flexible payment options, highlighting the need for innovation within the industry.
Open banking, a rapidly growing trend, has enabled fintech firms to leverage access to account information from major banks to provide new services. Companies like Coinbase and Robinhood have benefitted from open banking by fostering seamless connections to customers’ bank accounts, allowing for a wide range of financial services.
As GoCardless continues to navigate the evolving landscape of online payments, it remains focused on strategic growth opportunities, potentially leveraging the wave of mergers and acquisitions to solidify its position in the competitive fintech industry.
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