The initiative will create a mobile wallet allowing consumers to make payments via their mobile phones as well as transfer funds, pay bills and make online purchases, say the companies.

The service will be offered to banked and unbanked consumers and will aim to foster the acceptance of mobile payments in locations that traditionally have only accepted cash transactions, such as taxis and delivery services as well as direct sales such as door-to-door transactions.

Richard Hartzell, president of MasterCard for Latin America and the Caribbean, says: "The joint venture represents an excellent opportunity to offer affordable and efficient financial solutions to millions of consumers who have mobile phones but have never had access to the benefits of electronic payments."

The new company will operate independently with each shareholder holding 50% of the equity. Financial and staffing details have not been disclosed.

MasterCard says the venture will be managed separately to an earlier JV deal with Telefónica announced in January that will offer mobile payments to Movistar's 87 million customers in 12 countries in Latin America.