California-headquartered credit card giant Visa Inc. has announced the acquisition of Earthport, a British firm that facilitates cross-border transactions for banks and businesses, for £198 million ($250.6 million).
As reported by Reuters, Visa, via its subsidiary Visa International Service Association, has paid four times the closing value Earthport’s stock as on December 26.
With this acquisition, Visa made its footprint in the cross-border payment sector. Moreover, Earthport is a partner of the blockchain-based international payment firm Ripple. In 2014, the two firms joined hands so that they can use each other’s gateway protocol in fund transfers.
Earthport offers a single API (Application Program Interface) to banks and financial institutions for international payment transfers. The firm is currently operating in over 60 countries, and its client list include Ripple, Bank of America, Hyperwallet, Transferwise, Payoneer, and Japan Post Bank.
Blockchain is the Future
Earthport is also working on blockchain technology to reshape its cross-border payments network. In 2016, the firm launched a distributed ledger hub which enables its clients to use the group’s distributed ledger technology through a simple and inexpensive single API.
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Moreover, its partnership with Ripple is making its blockchain adoption simple as Ripple has more than 100 SWIFT-connected banks as its partners. This acquisition will enable Visa to push in this booming cross-border payments market, which according to the firm has risen ten percent in the 2018 fiscal year.
Earthport is a ripple partner who just recently developed a distributed ledger thats more user friendly for banks and smaller institutions. Visa will use that platform for its worldwide crossborder purchases and more
— @Mr. COOL DAD-E ??⚡️ (@EricVailNaylor2) December 27, 2018
The crypto community has turned very optimistic with this acquisition and believes that this might be a step forward for XRP towards the mainstream market. However, the value of XRP remains sluggish.
Earlier this month, Finance Magnates reported Ripple’s partnership with GMT, one of Israel’s largest fintech firm. Ripple also joined hands with CIMB Group, the fifth largest bank in the Association of Southeast Asian Nations (ASEAN), to facilitate cross-border payments across CIMB’s markets.