Visa Buys Out Personal Finance Enabler In Billion-Dollar Deal

  • Visa Buys Out Personal Finance Enabler In Billion-Dollar Deal

Visa Buys Out Personal Finance Enabler In Billion-Dollar Deal

Visa Inc has agreed to buy privately held financial technology startup Plaid Inc in a US$5.3 billion deal, the payments processor said on Monday. Visa estimates that 1 in every 4 Americans who have a bank account have used the underlying technologies of Plaid to link their bank accounts with other money transfer apps.

Visa said Plaid's core focus on fintech will open new market opportunities both in the United States and internationally.

"We are extremely excited about our acquisition of Plaid and how it enhances the growth trajectory of our business", said Visa CEO Al Kelly. "The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers". The deal is expected to close in the next three to six months.

Plaid allows consumers to connect their bank accounts to other types of financial services apps like Venmo, PayPal, Betterment and Transferwise.

The purchase price is twice the final private valuation and Visa is funding the transaction from cash on hand and debt issuance.

The acquisition is still subject to regulatory and customary closing conditions and will have no impact on Visa's previously announced stock buyback program or dividend policy.

Plaid likely doesn't have the name recognition of some of its client companies, but Visa said roughly one in four people with a USA bank account have used Plaid to share data with and connect to a finance app.