Xero’s acquisition comes as part of a strategic effort to expand its global footprint and embed deeper fintech capabilities into its accounting software platform. According to Xero, integrating Melio’s payment infrastructure will enable Xero users—particularly in the U.S.—to pay bills and receive payments more efficiently, all within the Xero ecosystem.

“Melio has built an exceptional platform with a focus on making business payments simple and seamless. This acquisition brings our customers more flexibility and control over their financial operations,” said Sukhinder Singh Cassidy, CEO of Xero. “Together, we aim to accelerate innovation and deliver more value to small businesses.”

The $2.5 billion deal will be funded through a combination of cash and stock, and is expected to close by the end of the year, pending regulatory approvals. Melio’s existing operations and workforce, based in New York, will be retained and continue to operate under the Xero brand, with Melio co-founder and CEO Matan Bar joining Xero’s leadership team.

The acquisition signals a growing trend among accounting and enterprise software providers to expand into adjacent fintech services. With increasing competition from players like Intuit (maker of QuickBooks) and Stripe, Xero’s move demonstrates a commitment to keeping pace in a rapidly evolving landscape.

Industry analysts have applauded the deal as a strategic win for Xero, offering a significant foothold in the U.S. payments sector. “This is a high-impact acquisition that positions Xero to be a more full-stack platform,” said fintech analyst Clara Davidson. “Melio’s technology and U.S. user base give Xero an accelerated path to dominance in a key market.”

Founded in 2006, Xero has grown into a leading provider of online accounting software, with a strong presence in Australia, New Zealand, the UK, and other global markets. The Melio acquisition is expected to unlock new revenue streams and enhance its competitive edge in the fintech ecosystem.