Visa announced it will acquire fintech payments connectivity firm Plaid, the company announced in a statement. Visa will pay $5.3 billion for the acquisition. The statement did reveal the structure of the purchase consideration.
In the statement, Visa CEO and Chairman Al Kelly said Plaid came to its attention due to its success as a fintech operator with a track record across multiple customer bases and verticals. He also emphasized Visa’s desire to purchase not just Plaid’s technology, but also the team that build it.
In addition, the statement cites statistics from EY, a consultancy, that three-quarters of online consumers used fintech to move their money in 2019. According to Kelly, this growing importance of fintech to payments highlights the importance of companies like Plaid to the modern payments ecosystem.
“We are extremely excited about our acquisition of Plaid and how it enhances the growth trajectory of our business,” Kelly said. “Plaid is a leader in the fast growing fintech world with best-in-class capabilities and talent. The acquisition, combined with our many fintech efforts already underway, will position Visa to deliver even more value for developers, financial institutions and consumers.”
In addition, Kelly explained the acquisition reflects Visa’s strategy to profit from fintech. Fintech disruption is a common problem for incumbent operators like Visa across all markets and verticals. Acquisitions like these allow Visa to continue to grow its presence even as new payments and fraud technologies emerge.
“This acquisition is the natural evolution of Visa’s 60-year journey from safely and securely connecting buyers and sellers to connecting consumers with digital financial services,” Kelly said. “The combination of Visa and Plaid will put us at the epicenter of the fintech world, expanding our total addressable market and accelerating our long-term revenue growth trajectory.”
Zach Perret, CEO and co-founder of Plaid, cited both Visa’s reputation and global reach as reasons for agreeing to the acquisition.
“Plaid’s mission is to make money easier for everyone, and we are excited for this opportunity to continue delivering on that promise at a global scale,” Perret said. “Visa is trusted by billions of consumers, businesses and financial institutions as a key part of the financial ecosystem, and together Visa and Plaid can support the rapid growth of digital financial services.”