Bill Holdings Inc. is in advanced talks to acquire Melio Payments, a provider of digital payment tools, people with knowledge of the matter said.

San Jose, California-based Bill is putting the final touches on a cash-and-stock deal for Melio that could be announced as soon as this week, according to one of the people. The transaction values Melio at $1.95 billion, the person said. The company’s valuation hit $4 billion in 2021 after it raised $250 million in an investment round co-led by Thrive Capital and General Catalyst.

While discussions are at a late stage, they could still be delayed or falter, and terms could change, the people said, asking not to be identified discussing confidential information.

Bill Holdings fell 1.6% to close at $62.19 in New York trading Wednesday, giving the company a market value of about $6.6 billion. The company provides financial-automation software to small and midsize businesses.

A representative for Melio declined to comment. Representatives for Bill didn’t immediately respond to requests for comment.

Melio, which has offices in New York, Tel Aviv and Denver, provides payments software to small businesses in industries ranging from food and beverage to construction, according to its website. Other investors in its September 2021 funding round included Tiger Global Management, Accel, Bessemer and Coatue.

Bill, led by founder and CEO Rene Lacerte, has been grappling with a small-business spending slump, which could hit its profit and revenue growth.