Last year, Visa had planned to buy U.S. firm Plaid for $5.3 Billion to acquire technology that would give the card network a foothold in open banking services. The Department of Justice scuttled those plans and accused Visa of wanting to purchase Plaid not for its capabilities but to shut it down to help protect its lucrative existing card business. In a move perhaps to prove its intentions to support open banking, Visa has announced the purchase of Tink, a Swedish start-up that plays a roll to connect fintechs and banks for financial services in Europe in and the UK. And this acquisition is priced at a mere $2.0 Billion.
Here’s what the Wall Street Journal reported about the deal:
Visa Inc., agreed to pay more than $2 billion for Tink, a Swedish startup whose digital services connect more than 3,400 banks and financial institutions in Europe.
The largest U.S. card network is buying the financial-technology company to establish itself in Europe’s fast-growing open banking market. Open banking regulation in the European Union and U.K. enables financial companies to access customers and their data at competing institutions, if the customers have granted consent.
Banks and consumer-facing financial startups use Tink’s services to create apps and other tools that let customers manage accounts at different institutions in one place.
The banks and financial institutions that Tink connects have more than 250 million customers in Europe. Through Tink, banks can access aggregated financial data, initiate payments, verify account ownership and build personal-finance management tools. Tink, founded in 2012, has 400 employees.
Overview Provided by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group