In its second acquisition in the remittance space in India within a week, US-based software services firm and ItzCash parent Ebix Inc has agreed to acquire the money transfer service scheme (MTSS) business of YouFirst Money Express Pvt. Ltd.
The deal comes soon after it bought BSE-listed Wall Street Finance Ltd’s MTSS assets for $7.4 million.
The company did not disclose the deal value.
However, according to a person privy to the development, the firm shelled out a little more than what it had spent to buy Wall Street Finance's assets.
The development also comes three months after Ebix acquired Essel Group’s fintech arm ItzCash Card Ltd for $120 million.
YouFirst Money Express is a wholly owned subsidiary of YouFirst Ventures Pvt. Ltd, which is promoted by former Citibank and RCap executive Vikrant Gugnani. It offers international inward remittance and foreign exchange services. YouFirst is one of the largest principal agents of Western Union for providing international money transfer services in India.
"It has a market share of around 15% of Western Union's India inward remittance flow. The acquisitions of YouFirst and Wall Street Finance’s MTSS inward remittance assets will give Ebix a 25% share of the inward international remittance market in India, strengthening its position in the financial exchange market in the country," Ebix said in a statement.
YourFirst has 36 MTSS branches and over 10,000 sub-agents across India. It claims to handle over 2.3 million transactions annually worth over $800 million.
"ItzCash has more than 75,000 physical retail outlets in the country. With the two acquisitions, its distribution network will reach 94,000 outlets," it said.
“The acquisition will not only help expand our reach, but will help nurture cross-selling and revenue opportunities for our distribution outlets,” said Robin Raina, chairman, president and CEO, Ebix.
"The deal offers a cross-selling opportunity. We will be able to offer insurance, mutual funds and credit, among others, for SMEs and end-consumers," Bhavik Vasa, chief growth officer, ItzCash told VCCircle.
Vasa and ItzCash chief business officer Ravi Singh have been leading Ebix's expansion strategy in India. Singh, former head of India operations at Western Union, said, “Having established our leadership in payments and domestic money transfer, we aim to drive our market share across international money transfer business as well.”
In June, ItzCash told VCCircle that after the Ebix deal, it was “looking at inorganic opportunities to grow its business and planning to foray into SME lending and international remittances through acquisitions.” Ebix also said it will invest $100 million mainly for acquisitions in the country.
Besides remittance, the firm is also in "discussions with a few peers and counterparts, mostly in the lending and travel sectors. We hope to close some deals in the coming quarters,” Vasa previously told VCCircle.