Banked snaps up Nick Candy-backed VibePay

London payments fintech Banked has acquired a fintech rival backed by property mogul Nick Candy, as it looks to drive up the adoption of an alternative to traditional card payments.

Banked, which is backed by Bank of America, has snapped up VibePay, the peer-to-peer payments and messaging fintech founded by Luke Massie, who grew up on a deprived council estate in Preston, England.

The all-share acquisition marks Banked's second purchase in the last 12 months, following its acquisition of Australian pay-by-bank provider Waave.

Candy, who is also treasurer of the UK political party Reform and has a fortune estimated at £1.5bn, will now hold around a 25 per cent stake in the combined group, with the combined group valued at over $100m, Sky News reported.

Another source told Tech.eu that Candy will likely look to take full control of the combined group over time.

Massie and Steven Smith, director of Candy Ventures, Candy's investment vehicle, will join the board of Banked, which is also backed by Edenred Capital Partners and Acrew Capital. Banked is headed up by CEO Brad Goodall.

The rationale for the deal is that the combined entity, helped by Banked’s infrastructure and global footprint, will reward debit users who have been overlooked by the traditional credit card system by offering them personal rewards and cashback when they pay-by bank, instead of by card.

While initially focusing on the UK, the combined entity will allow Banked's partners, which include Australian chemist Chemist Warehouse, to target pay-by-bank users through VibePay’s channels.

VibePay says it has over 250k active users with multiple banks linked to their VibePay accounts and last year bagged £5m in fresh funding.

This included investment from Candy, whose Candy Ventures vehicle is the largest shareholder in VibePay, bringing its total to £12m overall.

Massie said: “By joining forces with Banked, we now have the infrastructure, global reach, and merchant access to supercharge what we’ve built, and deliver real value to consumers at scale.”

Candy said: "This is a positive moment for the UK technology sector, with two British companies coming together to drive forward a global ambition. I’m proud to be a part of this journey and am eager to champion this story both in the UK and internationally.”