There are more signs of confidence that travel’s making a comeback, with outsider Nium now wanting a slice of the payments action by buying Ixaris.
A startup backed by Visa is jostling to become a major player in business-to-business travel payment technology, following its acquisition of Ixaris, a transaction which is planned for the third quarter. The amount has not been disclosed.
Nium, which was founded in 2014 as InstaReM, specialises in cross-border payments and originally targeted overseas workers sending their money home.
Now it’s jumping into the travel industry, predicting a strong leisure recovery and more demand for those cross-border payments due to the surge in remote work.
“This is probably the best time to make an acquisition because travel is coming,” Prajit Nanu, Nium’s co-founder and CEO, told Skift.
He said the travel industry had not experienced much digital transformation during the crisis as “everyone had their heads down, trying to figure what’s the future of travel.”
The proposed acquisition, which is subject to customary closing conditions, follows a funding round in May last year from Visa and BRI Ventures.
In April this year, Visa also extended its partnership with TripActions.
Looking ahead, Nanu thinks the way companies are embracing decentralized workforces will mean more global payments will be needed. “Look at Coinbase, or larger employers, they’re saying remote. That’s going to change things,” he said.
Ixaris was founded in 2003, and has 86 employees in London and Malta. Its virtual card technology provides flexible funding and payment methods that help airlines and online travel agents reduce surcharges, earn rebates, flatten foreign exchange fees, and streamline reconciliation.
For several years it has powered Amadeus’ B2B wallet with a prepaid solution. In December 2019, Ixaris began working with Sabre, to allow travel buyers using its Sabre Virtual Payments platform to streamline payments and protect margins when paying airlines or hotels.
“Ixaris has created a significant impact for its air partners. From an infrastructure perspective, it was a no brainer,” Nanu said. “This will lead us to market leadership over the next two to three years … with our financial infrastructure and global reach.”
That boast is aspirational, of course, given an array of payments’ platforms.
In December last year, Travelport sold its own business-to-business payment division, eNett, and Opal, to Wex in order to refocus on its core travel distribution technology. They were sold for $577.5 million — far less than the $1.7 billion Travelport expected pre-pandemic in January 2020.
The Nium-Ixaris deal could now accelerate transformation in back-office payments — an area that’s overdue for a shakeup. But Ixaris’ chairman said that it also helps the UK company grow as well. “This lowers our exposure purely to travel, and get access to a greater geographical footprint and product suite,” said Spencer Hanlon.
And Ixaris’ distribution partners Amadeus and Sabre welcomed the news, he claimed.
“They see it as Ixaris and Nium coming together and offering a bigger, broader partnership that they can exploit,” he said. “They want our services in as many markets as possible, they see future opportunity.”
Nium is also backed by Singapore sovereign wealth fund Temasek. In March 2019, it raised $41 million in a Series C round led by its investment arm Vertex Ventures. Temasek is also a majority shareholder in Singapore Airlines, and in March last year helped bolster the struggling carrier’s finances.
Nium, which employs 500 people, hopes to make another acquisition at the end of July. Nanu said this would be a payments company with around 165 employees.
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Photo Credit: Nium is acquiring virtual card payments company Ixaris, which is used by airlines and online travel agents. Pictured is an airport. Kychan / Unsplash
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