Bitmama, a leading blockchain payments startup, acquired Nigerian fintech startup Payday.
A media-viewed document shows that Bitmama’s Changera cross-border payments product facilitated the acquisition.
In September, tech news platform media reported that Payday was actively speaking to buyers six months after raising $3 million in a seed round led by Moniepoint. The Nigerian fintech company Moniepoint was in talks to buy Payday six months earlier, according to another publication.
The report stated that “Moniepoint had issued a letter of intent to acquire Payday, contingent upon specific performance benchmarks”, but the deal fell through. Sources told the publication that Moniepoint’s board opposed the deal.
Bitmama, founded by Ruth Iselema in 2017, uses stablecoin infrastructure to address market inefficiencies like dollar shortages, currency devaluation, and high remittance costs. Last September, the startup announced a $2 million pre-seed round.
Read also: Adaverse joins Bitmama Web3’s pre-seed round
Bitmama x Payday: Past repair
The acquisition by Bitmama was not disclosed, but an anonymous source told media that theChangera team had begun backend work to resolve the issues that users of the beleaguered fintech platform had reported.
In August, @PIDOMNIGERIA, a popular Twitter account, accused Favour Ori and PayDay of using arbitrary exchange rates, restricting withdraws and transfers without notice, and not responding to customer complaints.
A study released two months prior detailed a litany of customer complaints. People were scammed on the platform, resulting in unapproved account deductions or discrepancies in funded amounts.
The Payday team helped with the transition and resolution, according to the source. “We are working behind the scenes to improve technology and create efficient customer service,” the source said.
Payday expansion potential
Changera, a 2021 social payment solution, lets non-crypto users use their money worldwide. It makes cross-border payments and remittances easy and secure.
Changera issues MasterCard and VISA virtual and physical dollar cards. In Nigeria, Ghana, and Kenya, its virtual card allows up to $10,000 in monthly spending on local and international online/offline payment channels.
The new company announced four months ago that it would be working with MoneyGram to offer cash-in services in Canada, Senegal, Uganda, and Kenya, as well as cash-out services using Circle’s stablecoin, USDC, through the Stellar blockchain network at MoneyGram locations in more than 180 countries.
As a result, the purchase of Payday, a fintech startup that gives virtual dollar cards to people all over the continental, gives this company access to the data and 678,000 users (according to CEO Favour Ori’s most recent public count). In this case, Bitmama avoids a possibly significant cost of growth.
According to the source, the acquisition is a smart move because both companies see huge potential in working together. They also say that “this smart move will greatly benefit their customers and contribute to the overall enhancement of the fintech ecosystem.”
Payday Loans in the Future?
When we asked if the Payday brand would be taken over or kept as a separate business, our source said these details would be shared as soon as possible.
The much-anticipated announcement will also include information about who will lead Payday. The source adds, “I am sure that Bitmama and Payday are committed to open communication throughout this process.” “As the talks go on, we’ll keep our customers, investors, and other important people informed,” it says.
The candidate also said there are plans to add members of the Payday team to the Changera team in the future.
“Bitmama and Payday will each bring their special skills and strengths to the table when they work together.” It ends by saying that the acquisition will build on these strengths to create a “dynamic and comprehensive fintech platform.”
