Visa and Mastercard Focused on Acquisitions to Remain Competitive

Jun 28, 2019

In an effort to stay relevant and compete with powerhouses, like Amazon and Microsoft, the card networks, Visa and Mastercard, appear to be snatching of investments and companies left and right.

Don’t expect them calm down, especially as retail payments growth diminishes. They know they need to consider and buy into any investment opportunities, like cross-border payments, peer-to-peer, and interbank, to improve positions for cardholders and businesses and to remain competitive.

Major Acquisitions Made to Date

One of the biggest deals Visa has made was in 2016 when it returned Visa Europe back around for about $23 billion. Most recently, Visa acquired control of Earthport plc, which is one of the largest ACH networks in the world and allows the credit card scheme to expand real-time payment capabilities to the public. Visa completed the acquisition for $320.4 million, winning a tough bidding war with Mastercard.

The acquisition connects Visa to ACH and real-time networks in more than 85 countries, which allows the scheme to transfer money to those who don’t have Visa cards. Until this acquisition, Visa Direct service enables real-time push payments but receivers of money needed to have Visa cards to use it. Visa also bought the web-based commercial-card platform Fraedom to improve its corporate payments business.

Visa’s deal are in line with Mastercard’s most strategic move: gaining complete control of Europay in 2002. Mastercard also improved its bottom line in 2017 when it went for a piece of the global B2B payment market. It expanded its reach by acquiring a minority interest in the payments automation solution company that serves smaller business, AvidExchange. Mastercard also is taking a fresh hand at the bill payment market. It plans to acquire Transactis, which is bill payment company.

Both card schemes know that more features they can offer the more successful they will be. It attracts more businesses and shoppers, re-establishes network centrality, and provides them with a new base for profits. Acquiring financial technology companies in all spheres of payment has been the card scheme’s admitted strategy to gaining new deals and increasing revenues. Additionally, the card scheme doesn’t plan to stop.

Furthermore, Mastercard acquired the POS-lending platform for merchants, Vyze Inc., which was announced about a month or so after the credit card brand announced it was acquiring payment security services provider, Ethoca Inc., and B2B cross-border payment provider, Transfast.
Additionally, Mastercard has more than 20 possible deals on the table, as well as small investment and beginning-state funding for new businesses. To date, Mastercard’s most significant acquisition was its $920 million purchase of the London-based provider, Vocalink Holdings Ltd. Vocalink’s technology was first used in the United Kingdom’s faster-payments system, and it also has crept into systems in the U.S. and other countries.

What the Acquisitions Approach Means in the Long Run

Visa and Mastercard’s fast track to mergers and acquisitions is just proof that they want to find their places in the world with Amazon and other major players. Acquiring fintechs and seeking out other opportunities that mesh perfectly with the other services they offer makes complete sense. When a business stops innovating, they stop succeeding. These card schemes see the potential and they are turning them into their next big things. Who can argue with a strategy like that?

Apply for Merchant Account Services

Merchants that need merchant account services should contact EMB works with all types of businesses, including high-risk merchants. Apply online today for credit card processing.

Let us help you get a high risk merchant account today!

Get Started

Award winning.

  • 2012
  • 2013
  • 2014
  • 2015
  • 2016

Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

Live Chat