Visa, The Global Payment Giant, Purchases Plaid
On the 13th of January 2020, a press release announced the acquisition of Plaid by Visa. To acquire the technology company, the payment giant paid $5.3 billion. Some time ago, Plaid came up with a network allowing easy connection of users’ financial accounts to the apps they utilize in managing their finances.
Plaid’s products allow users to share financial information with numerous apps and services. Coinbase also uses plaid’s services to get the banking information of customers. The crypto wallet that is known as Abra also utilizes services from plaid.
Visa Shows Interest in Fintech Company
The press release pointed out that 75% of internet consumers worldwide utilized a fintech app to move funds. Therefore, promoting the consumer’s ability to use fintech apps is necessary. Through Plaid’s acquisition, Visa anticipates working more closely with fintech companies. In this case, it will move from connecting buyers and sellers to connect consumers with fintech services.
There are regulatory and customary requirements for the acquisition to be met. It will not affect the previous announcement of Visa regarding its stock buyback program or dividend policy. The expected timeline for the deal to close is 3 to 6 months.
Lately, Visa is showing an interest in the fintech sector. For instance, three months ago, Visa said it was in discussions with Facebook regarding Libra, despite intense regulatory concerns worldwide. Additionally, four months ago, Visa announced its partnership with the UK-based digital banking app, Revolut. Therefore, permitting Revolut to introduce its product in new jurisdictions that include eight countries.