Finom (PR42 profile), a fintech company that provides online financial services to small and medium-sized enterprises (SMEs), has acquired cross-border paytech company Kapaga in a deal worth at least £10 million. The merger will allow Finom to unify its separate paytech services for freelancers, SMEs, and corporate customers in the UK and Europe and advance its expansion plans.
Finom co-founder Kos Stiskin says, “Entrepreneurs and freelancers are the backbone of the European economy, worth $8 trillion a year, but costly and time-consuming bureaucracy means they can’t run their businesses as efficiently as possible.”
Stiskin says that by incorporating Kapaga into Finom, the new company will offer a product for SMEs “that meets all of our customer’s banking needs.”
Finom says the B2B financial services market for SMEs in Europe is currently “underserved,” with only 3% of European SMEs using digital platforms to manage their finances, “highlighting the gap in the market” as the majority still rely on traditional banks.
Finom’s mobile-first platform integrates financial management products such as e-invoicing, Single Euro Payments Area (SEPA) transactions and digital wallets into a back-office solution.
Founded in 2020, Kapaga’s cloud architecture provides companies with “transparency and efficiency” in streamlining cross-border payments, enabling them to send and charge money to over 190 countries and in numerous currencies through a single and secure application process.
Katya Dorofejeva, founder and CEO of Kapaga, comments, “Currently, there is no continental fintech provider that serves the UK and Europe equally and specifically targets SMEs – until now.”