Mogo enters B2B payments space
With opportunities arising in commercial payments since the pandemic due to the overwhelming adoption of digital modes, companies are looking at acquisitions to grab a share of the market.
This week, Vancouver-based financial technology company, Mogo Inc has acquired digital payments solution company, Carta Solutions Holding Corporation in order to enter the B2B payments space.
Carta’s issuing platform backs over 100 card programs and provides processing technology to fintechs including TransferWise, Sodexo and Payfare. In this acquisition, Mogo will integrate Carta’s payment processing engine with MogoSpend product which will be used in the development of P2P payment solution and it is targeted to be released in the first half of 2021.
In the press release, it was noted that Carta would be able to sell Mogo’s front-end digital platform to its fintech, bank and corporate clients.
With this acquisition, Mogo hopes to add Carta’s ‘scale and diversification’ to its portfolio and would provide backing to enter into B2B fintech market. The press release noted that Carta had generated CAD 8.5 million of payments & transaction revenue from corporate customers.
With this acquisition going forward, both the companies will have a hold and presence in over 40 countries worldwide with a target of ‘CAD 2.5 trillion addressable markets’. It also noted that over 85% of Carta’s revenue comes from outside Canada.
According to the press release, under the terms of the agreement, Mogo will acquire 100% of the outstanding shares of Carta in exchange for the issuance of 10 million common shares, which is equal to a purchase price of CAD 24.2 million based on the closing price of the Mogo Shares on the TSX on November 16, 2020.
“We see tremendous opportunity to accelerate the growth of our respective businesses by combining resources and capabilities,” said Peter Kaju, CEO of Carta.