Visa, Fundamo acquisition drives mobile financial inclusion in key geographic markets
According to Visa, the acquisition is part of its global strategy to enable the next generation of payments services.
Additionally, Visa signed an agreement with Monitise to expand delivery of mobile financial services to banked Visa account holders.
“Visa partnering with Fundamo and Monitise is a sign that they’re being aggressive with their strategy on mobile banking and devices,” said Neil Strother, Kirkland, WA.-based mobile practice director at ABI Research.
Visa is a global payments company that connects consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable digital currency.
Fundamo is a platform provider of mobile financial services for mobile network operators and financial institutions in developing economies.
Monitise enables financial institutions and other service providers to offer a wide range of mobile banking and payments services to their customers.
The acquisition between Visa and Fundamo will enhance functionality and new services to existing mobile financial services subscribers in Africa, Asia and Latin America.
The acquisition will expand on the use of closed-loop systems and make financial services available to more consumers, as well as offer merchants access to new customers.
According to both companies, the merger has the potential to connection billions of unbanked and under-banked consumers to each other.
In addition, carrers will be able to use Fundamo’s mobile services platform.
Visa will pay approximately $110 million in cash and the acquisition is expected to close June 9.
“All financial payment companies are chasing the mobile trend, and companies are making quick decisions about the industry right now,” Mr. Strother said.
“It’s clear, however, that Visa is on the right track to making themselves a presence in the industry with this new merger,” he said.
In addition to the Fundamo acquisition, Visa has signed a new commercial agreement with Monitise.
The agreement will help Visa virtualize existing Visa accounts on mobile devices and offer Visa account holders a new way to make payments.
According to Visa, the agreement introduces new mobile services to its existing account holders outside the U.S. and lets them make mobile and person-to-person payments, as well as offers them mobile transaction alerts and mobile marketing offers.
“Visa definitely is taking initiatives with their mobile banking plan, but they also have some heavy competition,” said Mr. Strother.