Visa To Acquire Fintech Company Plaid For $5.3 Billion

According to the press release from January 13, payments giant Visa has signed an acquisition agreement with fintech startup Plaid worth $5.3 billion.

The release states that Plaid has created a network which allows secure connections to financial accounts and apps people use in everyday financial life.

Plaid’s products also enables users to conveniently share their financial information by linking their bank accounts to the services they use.

The announcement indicates that in 2019 75% of users conducted money transfers via fintech apps. Therefore, it has “become increasingly important to facilitate consumers’ ability to use fintech applications.” Visa Chairman and CEO Al Kelly said:

“Plaid is a leader in the fast growing fintech world with best-in-class capabilities and talent. The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers.”

Plaid also serves cryptocurrency wallet Abra, while cryptocurrency exchange Coinbase also collaborates with the company for getting customer’s banking information.

Visa’s interest in innovation

Visa believes that the acquisition will enhance its collaboration with fintech companies. Kelly noted that Plaid’s acquisition shifts Visa from connecting customers to sellers to connecting customers with fintech services.

The acquisition is still subject to regulatory and customary closing conditions, and will not have any influence on the stock buyback program announced by Visa earlier or dividend policy. The deal will be closed in the next three to six months.

Visa has displayed a strong interest in fintech innovations. In October, Kelly said that the company still discusses collaboration possibilities with Facebook regarding Libra project, is spite of global regulatory controversy around it.

In late September, Visa announced that it established partnership with the United Kingdom-based digital banking app Revolut. It allowed Revolut to bring its service to new countries, such as Australia, Brazil, Canada, Japan, New Zealand, Russia, Singapore and the United States.