Mergers and Acquisitions in the Financial Sector: Key Trends - September 2025
In the dynamic world of consumer finance, the past year has seen a flurry of activity, with established banks, venture capital firms, and public markets all vying for a piece of the action.
One of the most significant developments has been the growing interest in buy-now, pay-later (BNPL) providers. Klarna, a leading player in this space, made headlines with its US IPO in September 2025, raising nearly $1.4 billion and boasting a valuation of around $14 billion. The offering, which combined a large direct capital raise with sales to existing investors, underscored the appeal of Klarna's customer-friendly "buy now, pay later" model, which has been adopted by over 100 million consumers and 720,000 merchants globally.
Klarna's success has not gone unnoticed, and other BNPL providers such as SeQura, Tabby, and Axio (with Amazon's investment) have also announced significant funding rounds. Citibank, for instance, participated in a €410 million debt and equity funding round for SeQura in November 2024.
Established banks are not only investing in BNPL providers but are also acquiring consumer finance companies to expand their operations. Delek Group, for example, acquired Isracard in July 2025, while IBL Banca acquired 60% of Fincentro Finance in February 2025.
Partnerships are another strategy being used to increase understanding of customer spending behaviours and to rapidly expand distribution channels. The Western Union acquired eurochange in April 2025, and BTB Israel acquired Loani in April 2025.
The credit cards and digital lending sectors have also seen substantial funding activity. In September 2024, White & Case advised Bank of Jerusalem on an unsolicited, deal-jump bid to acquire Isracard. Meanwhile, Catalyst Romania Fund II, South Central Ventures and Lead Ventures participated in a €10 million Series B funding round for Leanpay in July 2024.
Public markets, venture capital, and multilateral development banks have been active investors in consumer finance businesses. Development Partners International, Lorax Capital Partners, Apis Partners, Lunate and GB Corp participated in a US$157.5 million funding round for MNT-Halan in July 2024. Eleving Group had €29 million IPOs on the Nasdaq Riga Stock Exchange and Frankfurt Stock Exchange in October 2024.
However, the consumer finance sector is not without its challenges. Regulatory scrutiny and insolvencies have been issues of concern. Despite these challenges, lender and consumer appetite for BNPL is growing. Deutsche Bank provided a £250 million debt funding facility to Abound in March 2025, while Korelya Capital and Opera Tech Ventures participated in a €10 million funding round for Hokodo in April 2025.
As the sector continues to evolve, trends to watch include growing interest in payroll finance, personal loans, and strong credit card usage. Yonder, for instance, attracted investment from NatWest in April 2025, while Tembo secured funding from Goodwater Capital, Ascension Ventures and Love Ventures in December 2024.
In conclusion, the consumer finance sector is a bustling hub of activity, with a wide range of players vying for a piece of the action. Whether through acquisitions, partnerships, or investments, the sector continues to innovate and adapt to meet the changing needs of consumers.
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