Singapore — Singapore-based fintech company M-DAQ announced its buyout of Wallex, a B2B cross-border payments provider with licenses in Hong Kong, Indonesia, and Singapore. The acquisition marks the first for M-DAQ, as it expands its reach in the value chain and aims to capture other market opportunities.
Aside from the amount paid for the full acquisition, M-DAQ will also invest in accelerating the Wallex business. The combined entity is expected to process in the excess of S$15 billion or US$11b of Gross Transaction Value (GTV) this year.
Wallex offers a series of services namely facilitating B2B cross-border payments for businesses in markets namely Indonesia, Greater China, and Singapore by offering seamless transactions with competitive exchange rates and fees into more than 180 countries. Businesses can benefit from advanced multi-currency solutions to collect payments via virtual accounts and hold funds in a digital wallet. The payment platform also supports fintech companies in Asia to innovate and scale their businesses with customisable APIs by leveraging Wallex’s infrastructure to build cross-border offerings tailored to their customer needs.
Wallex has seen notable growth despite the pandemic with a recorded 5.5x growth in its annualised revenue over the past year. The Wallex platform supports nearly 2,000 banking and technology clients, processing almost S$4 billion in GTV annually.
Both entities improve on their existing offerings in virtue of the buyout. M-DAQ clients can benefit from a better experience with funds transfers through Wallex’s versatile technology, further improving reporting accuracy and regulatory reporting requirements. As for Wallex, their client can enhance their FX experience through the M-DAQ proprietary solution, Aladdin, that can provide guaranteed FX rates and achieve more competitive pricing through the aggregation and algorithmic capabilities that M-DAQ offers.
Richard Koh, founder and group CEO of M-DAQ, said that investing in businesses with strong growth potential is one of M-DAQ’s core strategies as they expand their ecosystem. He continued by saying that they are excited to welcome Wallex into the M-DAQ Group to strengthen their footprint in the payments space by reaching a wider range of SMEs and their customers as they look to provide additional value and cost reductions to their businesses. Both organisations will continue with their aggressive hiring to scale further Koh shared.
“M-DAQ is also investing in building an ecosystem that complements the core FX business. In this instance, M-DAQ will be the upstream FX provider to supply Wallex with the necessary liquidity it needs to run its core payments business. This B2B2b2C business model is an ecosystem of businesses that complements each other, reduces duplication, increases efficiency, and ultimately reduces transaction costs for the end clients, as economies of scale are materialised,” Koh said.
Wallex will continue as an independently operated business and brand, while simultaneously announcing the elevation of Hiro Kiga, co-founder and COO, as the new CEO of Wallex.
Hiro Kiga, co-founder and CEO of Wallex, commented, “At Wallex, we have always strived to deliver the most cost-efficient, fast, and secure payment solutions for global businesses. The combination of Wallex’s network and M-DAQ’s fintech expertise will enable us to deliver greater value to empower businesses across borders. We look forward to achieving our goals together, by creating new opportunities that leverage the strengths of each platform.”
Cross-border payments have seen significant growth due to rising demand from businesses of all sizes to engage in international trade. With a six-year track record of providing price certainty, M-DAQ’s flagship FX solution Aladdin has cleared close to S$30 billion cross-border transactions. The solution currently empowers two of the largest internet ecosystems in China. Aladdin enables customers on eCommerce platforms to shop in their home currency while allowing merchants to receive payment in their preferred currency and creating a new risk-free revenue stream for platform operators.