Cross-border payments provider, Payoneer has acquired Silicon Valley-based Armor Payments. The latter is the only licensed business-to business payment service which enables companies to pay and get paid safely, efficiently and cost-effectively offering Escrow-as-a-Service (EaaS).
An escrow is a financial instrument held by a third party on behalf of the other two parties in a transaction. The funds are held by the escrow service until it receives the appropriate written or oral instructions or until obligations have been fulfilled.
The terms of the deal were not disclosed. The acquisition is a combination of payment safety given by Armor Payments along with Payoneer’s multi-currency cross-border payment capabilities, which will be generating global prospects for businesses.
Scott Galit, CEO, Payoneer, stated, “The payments infrastructure for businesses has hardly changed in the past 30 years and it’s time that businesses are given the same high level of trust, security and ease of use that consumers have been enjoying all this time.”
It addresses the huge market of B2B transactions between $500 and $1,000,000, where credit cards and letters of credit are not suitable. Through this acquisition, Payoneer is now able to bridge the gap in B2B trade.
Armor Payments operate as a third-party mediator between buyers and sellers, holding funds in secure escrow accounts until both the parties are contended that the delivery of the good and services has been executed. The EaaS solution permits marketplaces to incorporate a trouble free Application Program Interface (API) and recommend secure payments that protect their buyers and sellers.
“Payoneer is already a trusted provider of B2B payment services to millions of small businesses around the world. The escrow solution of Armor Payments fills in a critical missing link for B2B transactions, and moves beyond payments to address the trust gap that often exists between trading partners,” said Galit.
“By acquiring Armor Payments, we are staying true to our vision of empowering global commerce by connecting businesses, professionals, countries and currencies. Our combined capabilities create a unique global platform that enables more businesses to grow faster by allowing them to securely trade across borders with more partners in more places, regardless of where they are in the world.”
According to New York Business Journal, the deal comes less than a year after Payoneer secured $50 million in venture capital from Wellington Management, a backer of Uber and Warby Parker. The firm is considered a viable competitor to eBay spin-off PayPal and U.K.-based Transferwise.
“Joining Payoneer is a natural step for our company,” said Scott Reynolds, Co-Founder and CEO of Armor Payments.
“It will open up our solutions to the huge and underserved international B2B market. Our EaaS solution enables B2B marketplaces to offer their customers secure, cost-effective methods of payment that can easily be built into their platforms. And SMBs all over the world can work and trade globally more effectively knowing both sides are fully protected from fraud. Payoneer is a leader in the online payments industry with an unparalleled platform that will significantly accelerate our growth trajectory. We’re excited to work with Payoneer to disrupt the outdated B2B payments and trade infrastructure,” he added.
Armor Payments will be joining Payoneer’s office in California and maintaining its development center in North Carolina.