California-based and crypto-friendly financial firm Social Finance — SoFi — is acquiring the digital payment platform Galileo.
In an April 7 press release, SoFi announced that it has signed an agreement to pay $1.2 billion for Galileo Financial Technologies. According to a CNBC report, the payment will consist of $75 million in cash, $875 million in stock, and $250 million in seller financing debt.
SoFi CEO Anthony Noto addressed how the partnership will help in the current financial market:
“Together with Galileo, we will partner to build on our companies’ strengths to drive even greater financial technology innovation, making those products and services available to both current and future partners.”
The financial firm has seen increasing demand since it launched zero-fee crypto trading on its platform SoFi Invest in September 2019.
What the partnership means for SoFi
In addition to its focus on fintech, the California-based firm intends to use the acquisition of Galileo to “extend the reach of its products to other Galileo partners in the United States and international markets, while offering diversification and scale to SoFi’s existing infrastructure.”
SoFi will have a lot on its plate for 2020. Precipitated by physical banks shutting down during the pandemic, more investors and individuals are turning to digital solutions like the ones the financial firm is offering. Noto said:
“It’s the right time to do something like this — we’re on the precipice of a transition to digital from physical finance. It’s going to serve people in this environment and the need for mobile financial services is only going to accelerate.”