Zepz Announces M&A and Digital Wallet Plans to Take on Rivals Like PayPal

Zepz, a leading fintech company in Europe, is actively seeking mergers and acquisitions (M&A) following a recent workforce reduction of 26%, according to CEO Mark Lenhard. With a valuation of $5 billion and support from prominent investors, Zepz aims to increase its stake in the global digital payments sector.

The Zepz Money Transfer Platform

Offering a user-friendly platform for transferring money across borders, Zepz competes with established money transfer services and traditional banks, highlighting its lower fees and faster transaction speeds. Notable rivals include Wise, which also boasts competitive rates for international money transfers.

Lenhard emphasised Zepz’s focus on digital wallets, with plans to launch its first wallet product in the near future. Targeting migrant communities sending funds back home, Zepz aims to become a core financial hub within this niche segment.

M&A for a New Digital Wallet

The decision to pursue M&A opportunities may come as a surprise following significant cost reductions at the 13-year-old company. Zepz recently laid off 420 employees, citing operational consolidation after acquiring U.S. remittances firm Sendwave. However, the firm remains committed to hiring, aiming to fill 200 roles.

Zepz’s upcoming digital wallet product is expected to strengthen customer reliance on the company, countering the allure of competing digital banks and financial apps offering a wider range of services. By offering a compelling alternative, Zepz aims to consolidate its position in the market.

Going Strong Despite Headwinds

While the fintech industry faces challenges due to declining technology valuations and macroeconomic pressures, Zepz claims to be less susceptible to these impacts compared to other firms. Lenhard highlights the resilience of world remittances amid broader macroeconomic trends, which has contributed to Zepz’s customer transaction growth of 25% year-to-date as of April 2023. Despite the recent cost-cutting measures, Zepz achieved monthly profitability in the first half of 2022 and aims to achieve profitability on a full-year basis this year.

In a highly competitive industry, Zepz’s pursuit of M&A opportunities demonstrates its determination to solidify its position in the digital payments space. With its sights set on digital wallets and catering to specific customer segments, Zepz seeks to capitalise on the projected growth of cross-border payments in the coming years.

As Zepz embarks on its expansion journey, the company’s ability to adapt to market dynamics, leverage its technological expertise, and deliver innovative solutions will play a pivotal role in shaping its success and positioning it as a key player in the global digital payments landscape.