Visa targets mobile banking

Visa stepped up its push into mobile banking on when it revealed two deals aimed at customers outside the US, reports the Financial Times.

The world's payment processor said it would pay $110 million for Fundamo, a South African company that makes software for mobile banking customers in Africa, Asia and the Middle East.

Visa also signed a new agreement with Monitise, a UK software maker that will enable existing Visa card holders in India, Russia, Mexico and Brazil to pay bills, buy transit tickets and perform other transactions on their mobile phones.

According to the US Today, mobile banking is a key growth area for Visa both in developed countries, as bank customers look for more convenience, and in the developing world, where many people either don't use banks, or use them only through a mobile device.

But getting different mobile carriers and bank payment systems to talk to each other can be difficult. Buying Fundamo will bring those networks into Visa's and bridge those gaps, the company said. It allows for person-to-person payments, adding cell phone minutes, bill paying, as well as banking services.

Meanwhile, the Banking Business Review says in the US, the deal will include a joint Visa-Monitise mobile-banking product for clients of Visa DPS, Visa's debit and prepaid processing unit.

Visa head of mobile banking Bill Gajda said these deals will add significantly to Visa's ability to extend payment services to the under-banked around the world.

"Visa will expand Fundamo's head office in Cape Town and will provide existing customers with more technology solutions.” He said he sees geographic expansion opportunities in Africa and Latin America that the companies can explore.