NEOPAY to Acquire 65% of noon payments: A Regional Payments Platform Takes Shape

NEOPAY "today announced that it has entered into a definitive agreement to acquire a 65% controlling stake in noon payments". Completion "remains subject to customary conditions precedent, including applicable regulatory and antitrust approvals". As ITP.net reported (opens in a new tab), "the announcement did not disclose the deal’s value or an expected completion date."

Buying control rather than the whole business is a common structure in Gulf payments. It gives NEOPAY the decision rights to integrate the platforms, while the remaining 35% leaves room for continued alignment with the noon ecosystem that generates much of the gateway’s volume. The announcement does not specify who holds the balance after completion.

Who NEOPAY is

NEOPAY describes itself as "one of the UAE’s leading digital payments companies", providing payment infrastructure to businesses, financial institutions and government entities across the Middle East. Its portfolio spans merchant acquiring, omnichannel acceptance, payment orchestration, embedded finance and issuer processing. It is "backed by a strategic consortium led by Arcapita and Dgpays, with continued support from Mashreq", and serves "thousands of merchants across retail, e-commerce, hospitality and the public sector".

noon payments brings "an embedded payments platform, e-commerce gateway and merchant network across the UAE, Saudi Arabia and Egypt". NEOPAY says it "has established strong integrations with marketplace sellers and online merchants, creating high transaction density in some of the region’s fastest-growing digital commerce segments".

Its parent gives it a rare starting point. noon launched its consumer platform in Saudi Arabia and the UAE on 12 December 2017, entered Egypt in February 2019, and has "evolved to become the largest online shopping destination in the Middle East", building native capabilities "throughout its marketplace, fulfillment, logistics, and payment systems". The payments arm is the part of that stack now finding a specialist owner.

Built for the region

"Payments should be simple, reliable, and built for the markets they serve," said Faraz Khalid, CEO of noon. "NEOPAY brings deep local expertise and strong infrastructure. Together, we can help merchants grow and make paying easier for millions of customers across the region." noon payments also publishes developer documentation (opens in a new tab) for merchants integrating its gateway.

"As commerce increasingly moves across physical and digital channels, merchants are looking for payment partners that can support them seamlessly across markets and customer journeys," NEOPAY said. The combined business will offer "a more integrated proposition spanning online payment acceptance, in-store acquiring, faster settlements, data and analytics, and value-added financial services".

Mundhada set out the geography: "This acquisition will reinforce our leadership in the UAE, expand our footprint into Saudi Arabia and Egypt, and strengthen NEOPAY’s position as the payments provider of choice for businesses across MENA." Saudi Arabia and Egypt are two of the region’s largest consumer markets.

Volume and relationships

NEOPAY says the deal "will give NEOPAY access to additional merchant relationships and payment flows while accelerating the rollout of regional payment innovations, including alternative payment methods and installment options". In payments, scale drives unit cost and data, so adding a dense, digital-first merchant base strengthens the whole platform.

NEOPAY says "the combined roadmap will focus on making it easier for merchants to do business across the region, including faster merchant onboarding, improved payment performance, advanced fraud capabilities and embedded financial services". The deal "will also create opportunities to strengthen cross-border payments and settlement capabilities across key regional commerce corridors".

Faster settlement matters most to small merchants. As ITP.net explains, settlement is how a customer’s payment reaches the merchant, and "speeding it up could help businesses access funds sooner to cover stock, suppliers and other operating costs". Instalments and alternative payment methods, meanwhile, lift conversion at online checkouts.

Embedded finance

NEOPAY already lists embedded finance and issuer processing in its portfolio. Pairing those with a gateway that sees online sales data opens the door to merchant financing and other value-added services delivered inside the payment flow, the direction payments platforms are taking worldwide.

Completion "remains subject to customary conditions precedent, including applicable regulatory and antitrust approvals". Payments deals in the region typically need sign-off from central banks and competition authorities in each market where the business is licensed.

What to watch

• –Approvals. Regulatory and antitrust clearances in each market, the gating item in what was agreed.
• –Merchant integration. How existing noon payments integrations are managed; ITP.net notes the announcement does not yet specify this.
• –Products. The first launches from the combined roadmap, such as instalments and faster settlement.
• –Saudi Arabia and Egypt. NEOPAY’s growth in its two new markets.
• –Brand. Whether noon payments keeps its name for merchants after completion.