Google looking to enter Japanese fintech market with acquisition
Google is in talks with cashless payments provider Pring to acquire all its company shares as it looks to enter into the fintech segment in Japan in a big way.
According to a report in Nikkei, Google is planning this move so that it need not depend on third parties for payments and other related services and it would be able to offer these services internally.
Google and its investment partners are looking to acquire all the company shares of Pring, which is currently owned by Mizuho Bank, for $180 million to $200 million. Though Google has its own Google Pay services in Japan, it has to depend on other companies for processing credit card and pre-paid card transactions which increase cost and also reduces control and reliability.
The Japanese cashless transactions market is not fully developed as yet. The penetration of cashless payments is still only 30% which means that there is a lot of space for growth. With cashless payments expected to rule the roost in the coming months all around the world. it seems Google is looking to pick its cherries by looking for markets where there is still space to go and Japan seems to be a good choice considering that the technology in the payments space is still pretty far behind when compared to the rest of the world.
Pring currently operates both on mobile as well as computers as it offers payments, cash transfers, and other related services to its client base. It also has onboarded over 400 merchants on its platform who use it for making payments to customers and other merchants as well.
With this acquisition, Google can be expected to take over the licenses that Pring has which means that it would be able to undertake all the services currently operated by the company and more, once the acquisition goes through. This is another boost for the payments industry which has seen a lot of interest over the last few months as more and more users choose cashless and digital payment methods over other traditional systems, even for basic and necessary payments.
The pandemic has been one of the main drivers for this move and the payments industry is reaping the benefits of this change in the attitude of the users. But with the majors expected to enter into the industry and also try and consolidate it with acquisitions, the smaller players are likely to feel the pressure.