SoFi just acquired a digital payment platform for $1.2b
- Californian financial firm, SoFi, recently announced the acquisition of a digital payment platform, Galileo.
- The firm announced the move on April 7th, stating that it will help its move towards digital finance.
- SoFi also hopes to gain access to Galileo's partners and expand its reach and offering.
The crypto-friendly financial firm from California, Social Finance (SoFi) just announced a purchase of a digital payment platform. The platform in question is Galileo Financial Technologies. SoFi acquired the payment platform in a $1.2 billion deal, according to its announcement.
The announcement itself came out yesterday, April 7th, where SoFi revealed that it has signed an official agreement. The funds will be split, with $875 million coming in stock, $75m coming in cash, and $250m in seller financing debt.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.
Both firms will benefit from the acquisition
The move comes out of the desire to improve SoFi’s strengths, and drive greater financial technology innovation. The firm’s CEO, Anthony Noto, spoke of the partnership, stating that it will help in the current financial market. By working together, both firms will advance, and start offering new products and services to current and future partners.
This is important to SoFi because it saw a surge in demand ever since it announced its zero-fee crypto trading. This particular move took place in September last year. Ever since then, SoFi had to deal with much greater demand and activity.
Noto also added that “It’s the right time to do something like this — we’re on the precipice of a transition to digital from physical finance.” The transition comes due to numerous physical banks shutting down due to the coronavirus pandemic.
The company wishes to expand its reach
During these times of uncertainty, investors and regular users are all turning to digital solutions. These do not depend on banks, and users can manage them, buy them, or trade them, themselves. SoFi’s offering of such solutions is what continues to drive users towards its platform.
However, that is not all. The company’s focus on fintech is only a part of its intentions. It also aims to use Galileo for extending the reach of its products to Galileo’s own partners. Especially when it comes to the ones based in the US, but also in other international markets. At the same time, SoFi’s own infrastructure will offer scale and diversification.