Visa, one of the world’s largest global payment systems, announced the acquisition of Britain’s Currencycloud. A platform to provide innovative currency solutions for cross-border transactions to banks and fintech companies.
After this news, the company’s shares rose slightly during the trading session.
Colleen Ostrowski, the company’s global treasurer, said the deal would, in part, improve Visa’s transparency and speed of payments.
The deal amounted to $ 963 million. At the same time, the amount that Visa will pay for the startup will be reduced. Due to the outstanding share capital of the company, which it already owns. In early 2020, the payment giant invested $ 80 million in Currencycloud. The venture capital division of Google Alphabet GV also invested in the company. The total amount of investments attracted by the company, according to Crunchbase, is $ 160.2 million.
The company plans to spend money on expansion in Asia, in particular, opening an office in Singapore.
According to Currencycloud CEO Mike Laven, the service expects to begin cooperation with all investors in the last round.
The current acquisition is part of a strategic partnership between the two companies. Note that the platform will continue to operate from its headquarters in London. And retain the current management team. Note that the deal still requires regulatory approval.
What is Currencycloud?
Currencycloud was founded in 2007. The startup’s cloud platform “offers a wide range of APIs that allow banks and other financial institutions to provide currency exchange services, including currency notifications, multicurrency wallets and virtual account management,” the release said. The platform works with approximately 500 clients in over 180 countries.
Currencycloud sells software for processing international payments – these technologies are at the heart of many popular banking and payment applications, including Britain’s Monzo, Starling, and Revolut, founded by Russian Nikolai Storonsky. Since launch, the startup has processed over $ 50 billion in payments.
One of the company’s products, Spark, allows customers to collect, store, convert and process payments in 35 currencies.
The acquisition of Currencycloud is Visa’s second major fintech deal this year. Earlier, in June, the payment system agreed to purchase the Swedish startup Tink, the development of which allows banks and companies to access financial data of clients. The deal amounted to € 1.8 billion. Visa decided to buy Tink after the company’s plans to acquire its American competitor Plaid thwarted by US regulators.
A great purchase for Visa
Visa is a global payment system that provides access to an electronic payment network to cardholders, merchants, financial institutions and government agencies.
The Currencycloud chief explained that the fintech business market – a sector that includes rival payment processors such as Stripe, Adyen and Checkout.com – is “much more than a consumer business” and “more profitable” albeit “complex”, Which is why it is a good buy for Visa.
Through this acquisition, Visa will strengthen its foreign exchange capabilities by expanding its offerings to its clients, including various financial institutions and financial and technical companies.