Morgan Stanley, one of the biggest investment banks in the US, has initiated a mulit-million dollar cash injection into a Miami-based payments firm.
In a deal showcasing the investment potential of fintech firms, Morgan Stanley Expansion Capital has invested $20m in Banking-as-a-Service (BaaS) platform NovoPayment.
The bank and payments firm, respectively, plan to use the funding to support NovoPayment’s scaling ambitions and expansion of commercial partnerships. The company’s specialisations are in digital banking, payments and card solutions.
Pete Chung, Managing Director and Head of Morgan Stanley Expansion Capital, said:
“NovoPayment’s robust technology platform has positioned the company as a leader in the Latin America market.
“The company’s mission-critical infrastructure enables the modernization of marquee banks and financial institutions in the region through a comprehensive, full-stack platform.”
NovoPayment already has a diverse range of partners, including both traditional banks and neobanks, financial institutions, digital merchants and fintechs with digital finance and payments solutions.
Morgan Stanely cited the company’s ‘innovative business’, delivery model and ability to fill gaps in the market as the primary reasons for its investment, alongside its geographical reach – the firm being active in 15 markets across the US, Caribbean and Latin America.
The deal demonstrates the continuing value of US fintech. Though it has yet to build up a leadership position in areas like Open Banking, financial services is a core market in the US, which is home to one of the world’s largest banking sectors.
This sector has in turn driven demand for fintech and paytech solutions. Innovate Finance, an industry body for UK fintech, reported $7.3bn in investment across 599 deals in US fintech in H1 2024, accounting for 45.6% of global fintech investment.
Commenting on Morgan Stanley’s investment, Anabel Perez, CEO of NovoPayment, said: “We are thrilled to receive this investment from Morgan Stanley Expansion Capital to support our continued innovation and service expansion to grow our customer base, further amplifying our positive impact in the markets in which we operate.
“As the financial services landscape continues to evolve, we believe NovoPayment is well-positioned to compete in the embedded finance market by reducing friction and driving efficiency.”
