Russian technology firms Yandex, Mail.ru Group, Ozon and Wildberries are reportedly creating their own Fintech platforms so that they can potentially compete with some of the largest banks in the country, according to a report from Forbes Russia.
As first reported by the New Economy Observer, Nasdaq-listed Yandex, which was in negotiations to acquire Russia’s digital bank Tinkoff (but the deal failed), has now decided to continue its focus on Fintech so it can offer some type of financial services via mergers and acquisitions or some other way, according to Sova Capital.
Mail.ru Group, an established email and online service provider, has revealed that it would be launching joint ventures in payments and finance with USM holding, Ant Group, Russian mobile phone company Megafon and the Russian Direct Investment Fund (RDIF). These deals (payments and financial services) are valued at $150 million to $200 million, according to estimates from Goldman Sachs.
Russia’s leading digital or online marketplaces have also announced Fintech-focused initiatives. Digital commerce firm Ozon, which is referred to as the “Amazon of Russia” and is known for conducting a successful public offering in the US, has been focused on expanding Fintech services.
These financial tech services from Ozon include Credit microfinance loans to consumers, the Ozon.Invest lending solution for marketplace sellers and the Ozon.Card cashback debit card. Notably, the Wildberries marketplace has acquired a bank in order to support its payment services.
The dramatic rise in digital commerce during the COVID-19 outbreak has provided a boost to Fintechs, especially among major retailers, according to industry analysts. Digital payments are now a vital part of the online shopping experience. Internet retailers that provide a user-friendly and intuitive payment experience are usually more likely to see return customers or improved customer loyalty, which generates more revenue.
It’s not only tech firms that are getting into Fintech as consumer activity continues to move to a digital environment. Walmart, one of the world’s largest retail platforms, has established a Fintech company that will provide certain online banking services. Walmart will reportedly be working with experienced bankers from Goldman Sachs in order to offer the new services.