▼ Summary
– Airwallex is launching a point-of-sale product to enter the in-person payments market, directly competing with companies like Square and Adyen.
– Its new product allows businesses to accept in-person payments across multiple countries on one platform without needing local vendors in each market.
– The company built its own global payment infrastructure over years, holding numerous regulatory licenses and direct connections to local networks in over 120 countries.
– Airwallex declined a $1.2 billion acquisition offer from Stripe in 2019 and has since grown to a $8 billion valuation with about $1.3 billion in annualized revenue.
– A key infrastructure advantage is its ability, via local licenses, to hold and manage merchant funds within a market rather than immediately repatriating them.
After a decade focused on constructing a global digital payments network, the Australian fintech Airwallex is now entering the physical payments arena. This strategic expansion directly pits the company against established giants like Stripe, Square, and Adyen on one of the final major fronts in financial technology competition. The company is launching a point-of-sale product designed to solve a persistent problem for international businesses, allowing them to accept in-person payments across multiple countries using a single, unified platform.
Chief Executive Jack Zhang explained the common pain point the new system addresses. When a company enters a new market, he noted, the process typically involves finding a local payment acquirer, navigating separate compliance rules, and managing an entirely new vendor relationship. Airwallex’s platform aims to eliminate that fragmented approach.
The move represents a significant escalation in a long-running rivalry. Back in 2019, Stripe attempted to acquire Airwallex for $1.2 billion when the startup was generating just $2 million in revenue. Zhang initially agreed to the deal during lengthy negotiations but ultimately reversed his decision. He recalled that returning to Melbourne and reflecting on his original motivation for founding the company in 2015, which was frustration with the cost and complexity of international money movement, convinced him to continue building independently.
While many fintechs layer software on top of existing banking infrastructure, Zhang’s team spent years assembling its own underlying payment rails. That foundational work is now the core of Airwallex’s competitive argument. The company, currently valued at $8 billion by its investors, reports annualized revenue of approximately $1.3 billion, growing at about 85% per year. It serves over 46,000 U. S. businesses and processes $100 billion in annual transaction volume.
A key differentiator, according to Zhang, is the depth of its regulatory and banking integration. The company holds nearly 90 licenses across dozens of regions, has direct connections to local networks in over 120 countries, and can settle transactions in more than 90 currencies. This infrastructure includes local banking licenses that competitors like Stripe and Square lack. These licenses allow Airwallex to hold, convert, and deploy funds within a market instead of immediately repatriating them.
Zhang used Japan as a specific example. While other platforms can process payments there, they must payout to a merchant’s bank account immediately. Airwallex’s hard-won license, which took seven years to secure, permits it to hold those funds locally. The new POS product brings this capability to physical storefronts, creating a unified system for in-store and online payments with consolidated reporting and back-office integration.
In the global payments space, Dutch firm Adyen presents a similar infrastructure-based argument and is likely Airwallex’s most direct competitor. Meanwhile, legacy providers like Fiserv and the combined Global Payments-Worldpay entity dominate market share among traditional retailers, though their technology architectures are older. To accelerate its U. S. push, Airwallex has committed to investing $1 billion between now and 2029, a substantial increase from the $150 million spent over the prior five years.
The central question is whether businesses already entrenched with Stripe or Square will find the promise of global infrastructure compelling enough to switch providers. Airwallex is wagering that multinational companies, weary of managing a patchwork of regional vendors, will see the value in a single platform. Zhang pointed to the lack of serious competition for Stripe over the past fifteen years as an anomaly in such a vast market, a gap his company now intends to fill.
(Source: TechCrunch)
