France's fourth largest bank has gobbled up a fintech startup that specialises in digital banking.
BPCE has acquired German challenger Fidor to push forward its digital strategy across Europe. Fidor, named one of Europe's hottest fintech companies, currently operates in several countries including the UK.
Founded in 2009 and with investment from Anthemis Group among others, BPCE has agreed to acquire their equity stakes in the business for an undisclosed sum.
Founder and chief executive Matthias Kroener will continue to lead the business and will retain his shareholding.
"This move will allow Fidor to continue its international expansion and drive the development of our innovative digital technology even further," said Kroener.
"In a world of increasing volatility, it is important to be member of a strong group and this transaction is strongly improving our overall financial sustainability. We are excited to have such a well-established partner as BPCE in the financial world that recognises the need for an entrepreneurial approach to banking and innovation.”
BPCE chairman Francois Perol said: “This operation constitutes a key step in the acceleration of the digital transformation of our group."
"It further demonstrates our commitment to innovation, to developing a customer centric approach enabled by digital banking technology, and to be more involved in the digital and mobile banking field. We are very proud and happy to welcome Fidor’s teams, communities and clients into BPCE.”
Fidor will operate under a new structure, separating its own banking business from its white label service under a parent company that will operate independently from BPCE.
Banks are increasingly taking note of the growth of fintech firms and their potential disruption to the traditional banking business. UK challenger bank Atom landed ￡45m from Spanish bank BBVA for a near-30 per cent stake in the bank last year.
BPCE has looked toward digital development itself with innovations such as a mobile payment app and letting users transfer cash via just a tweet.