- Western Union has announced that it will take a stake in stc pay after the two companies established a strong working relationship.
- It is believed that Western Union will pay US$200m to take a 15% stake in the firm.
- Senior figures at both firms said that stc pay, which is owned by Saudi Telecom Company and has been designated as a fintech ‘unicorn’, expressed positive thoughts about the partnership.
International money transfers company Western Union has announced that it will take a stake in a smaller firm.
The payments giant will invest in stc pay, which is the shortened trading name of Saudi Digital Payments Company.
Press reports suggest that Western Union, which is one of the world’s most well-known payment brands, will provide an investment capped at US$200m as part of the transaction.
This will result in a stake of around 15% in stc pay.
The two firms, which have a working relationship that pre-dates this investment, will continue to collaborate in this way after the deal is closed.
It is understood that the arrangement will be finalised by Q1 2021.
It is, however, contingent on the firms receiving the green light from regulators to go ahead.
In a press statement, a leading Western Union spokesperson said that the new collaboration was positive because the two firms have such a long and distinguished history of collaboration.
“We are very excited about this investment in stc pay because of our demonstrated success working together,” said Jean Claude Farah, who serves as president of global network at Western Union.
He predicted that stc pay would go on to capture further market shares in the future.
“We believe the company is well positioned for continued growth and expansion into new digital payment services in the Gulf region,” he explained.
He ended his remarks by explaining that Western Union would bring its own benefits to the table in order to help stc pay continue to grow.
“This is a great opportunity to participate in the growth potential of an innovative and dynamic financial services company such as stc pay and supporting its growing customer base through our market leading cross-border services” he concluded.
Saudi Digital Payments Company is owned in its entirety by Saudi Telecom Company.
One of its senior figures said that the firm was now described by watchers in the fintech field as a “unicorn” – a term that refers to a relatively new company that has a valuation of more than $1bn.
The company is “proud” to have “reached unicorn status” and “been recognized as a fintech national champion in a very short time,” said Saudi Telecom Company’s chief executive officer Nasser Alnasser.
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