Visa is to acquire a 'significant' minority equity stake in Nigerian payments processor Interswitch in a deal that propels the African firm into Unicorn territory.
Visa will join existing investors, Helios Investment Partners, TA Associates and IFC, as shareholders in Interswitch, alongside company management.
Founded in 2002, Interswitch now processes over 500 million transactions per month in a market that is seeing soaring growth in electronic payments. Further progress is expected to be driven by population and urbanisation growth, GDP growth above the global average, increased mobile and internet penetration, as well as a supportive regulatory landscape for electronic payments and financial inclusion.
Mitchell Elegbe, Intersitch founder and CEO expands: “Sub-Saharan Africa is the fastest growing payments market in the world, with growth driven by a young and dynamic population, rapidly evolving consumer behaviour, and an increasing desire for payment solutions that can be accepted across the continent and abroad. I am delighted that Interswitch has formed a partnership with Visa, with whom we plan to drive the next phase of transformation in the African payments landscape.”
In addition to its switching and processing services, Interswitch owns Verve, the largest domestic debit card scheme in Africa with more than 19 million cards activated on its network, and the Quickteller consumer payments platform from which consumers can initiate peer-to-peer transfers, bill payments, airtime purchases, and other e-commerce transactions. The latter processes 42 million transactions monthly through direct, indirect and Paypoint channels.
Andrew Torre, regional president Cemea, Visa, says: “Africa is a priority region for us, and we continually seek strategic partnerships with local players to further strengthen our leadership position and enhance the payments ecosystem across the continent. This partnership aligns with our global strategy to work with and invest in innovative partners, and we look forward to working with Interswitch to provide new consumer and merchant experiences and support the rapid growth of digital commerce across Africa.”
The transaction is expected to close by Q1 2020.