European banks exit payment businesses

Banks in Europe are now letting go of their payment/fintech operations following difficulties with scaling in the face of brutal competition posed by mainstream fintech firms and payment solution providers.

Between June 2020 and today, banks in the region have sold a combined US$1.46 billion in payment operations. An example of such is the sale of Greece-based Piraeus Financial Holdings SA’s merchant acquisition arm for $358 million. 

The purchase was made by Euronet Worldwide Inc. in March, making the Kansas-based firm Euronet one of the biggest spenders in the selloff spree, alongside France-based payments firm Worldline.

The selloff became necessary after most of these banks failed to grow the user-base and network of their payment services to a size that will make the business a worthwhile pursuit.

On the flipside, fintech firms and payment solution providers are ramping up acquisitions of operations in the sector to maximize the growth predictions of the future. 

Finaria’s most recent data revealed that transactions in the sector will grow 28.3% this year to $1.17 trillion.