In June, after obtaining approval from the Reserve Bank of India, Amazon completed its acquisition of Axio, a fintech company, which is estimated to be valued at approximately $200 million.

Integration with Amazon Pay

Axio was previously providing buy now, pay later services in India through Amazon Pay. With the deal finalized, Axio will become a fully owned subsidiary of Amazon and enhance the offerings of Amazon Pay, which has seen limited success so far in India.

Financial Impact and Objective

Axio was founded 12 years ago and has served about 10 million customers with its digital credit and money management services for both consumers and small businesses. The acquisition aims to increase financial inclusion, given that only about one-sixth of Indian consumers have access to financing options at checkout.

Enhancing Amazon Pay’s Reach

The move is expected to boost the reach of Amazon Pay, which ranked ninth in terms of service volume on India’s Unified Payments Interface (UPI). Amazon Pay Later, an installment plan offering by Amazon, will also benefit from this acquisition. Additionally, Amazon has received approvals from the Reserve Bank of India for payment wallet issuance and insurance policy sales through its online marketplace.

Retailers’ Expansion in Financial Services

This acquisition aligns with a broader trend where major retailers are expanding into financial services. For instance, Walmart recently took a majority stake in One, which has been pivotal to the retailer’s BNPL and credit card initiatives. Both Amazon and Walmart are also considering the launch of brand-specific stablecoins, which could significantly impact transaction fees and payment methods if implemented.