The global payments giant Visa has finalized an agreement to buy out a majority stake in the Mexican payment processor PROSA. The undisclosed transaction aims to enhance digital payment adoption in Mexico. The deal is set to conclude in the second half of 2024, subject to regulatory approvals and standard closing conditions.
Under the agreement, PROSA will maintain its independence and use its technology. Visa will support PROSA in expanding its product offerings and share expertise with its existing leadership, who will be retained. The remaining stake in PROSA will continue to be owned by its current shareholders, including HSBC Mexico, Banorte, Santander Mexico, Invex, Banjército, and Scotiabank Mexico.
Key Takeaways:
- Visa’s Strategic Commitment: Visa’s acquisition of a majority stake in Prosa underscores a strategic commitment to transform Mexico’s payment system. The focus is on adopting innovative and secure digital payment methods within the country, aligning with Visa’s global network strategy.
- Empowering Global Payments Ecosystem: The investment is poised to empower participants in the global payments system, enabling them to shape Mexico’s payments sector actively. This collaboration promises to broaden possibilities for consumers and merchants, emphasizing the importance of innovation and tech in advancing the payment sector.
- Enhancing Prosa ‘s Offerings: Visa’s support aims to improve Prosa ‘s offerings by introducing new digital payment solutions and leveraging Visa’s expertise. The collaboration anticipates introducing novel services, including real-time transactions and more advanced technology, fostering increased competition in the Mexican market and benefiting consumers.
- Strategic Integration Impact: The anticipated closure of the deal in the latter half of 2024 marks a significant development, aligning with Visa’s vision to enhance and diversify capabilities globally. Beyond a mere business transaction, this integration signifies a collaborative exchange of expertise, emphasizing Visa’s commitment to technological advancement and financial inclusivity on a global scale.
Visa’s Strategic Investment In Prosa To Transform Mexico’s Payment System
Visa has made a solid commitment to buy a majority stake in Prosa, a prominent payments processing company in Mexico. The deal’s primary goal is to expedite the country’s adoption of secure and innovative digital payment methods.
Image source: Prosa
According to the deal’s agreement, the Mexican giant will maintain its autonomy as a standalone entity, retaining its technological infrastructure. Visa aims to enhance Prosa ‘s offerings by introducing new digital payment solutions and leveraging its global network expertise.
Visa’s investment is anticipated to empower participants in the global payments ecosystem to play a more prominent role in shaping Mexico’s payment sector. This move is poised to broaden the possibilities for merchants and consumers. It’s worth noting that, as per the acquisition agreement, Prosa ‘s existing shareholders, which include HSBC Mexico, Banorte, Santander Mexico, Invex, Banjército, and Scotiabank Mexico, will retain ownership of the remaining portion of the company.
Eduardo Coello, Visa Latin America’s and the Caribbean’s regional president, emphasized the significance of technology and new creation in their business. He stated that this investment aligns with their network of networks strategy, where they integrate top-notch technologies globally to complement their own. With the advanced technology infrastructure from Visa’s worldwide payments network, they are laying the foundation to create new, innovative payment methods for SMBs and consumers. This development will be in collaboration with local acquirers and issuers in Mexico.
Visa’s move to buy Prosa is set to empower participants in the global payments system, enabling them to play a better role in shaping Mexico’s payment market. This move promises to expand various possibilities for merchants and consumers. Furthermore, Prosa will be ready to bring several fresh advantages to the payment environment in Mexico.
After the deal closes, Prosa will aggressively market these advantages to Mexican cardholders in association with issuers and other payment industry players. This includes a goal to improve Visa brand services, such as more tokenized payments, and the technology underpinning Prosa ‘s brand-agnostic services. He went on to say that Prosa, by using Visa’s array of offerings, will also work to provide new services to the market that will enable real-time payment transactions using more sophisticated technologies. The goal of this continuous innovation-driven solution creation is to boost competitiveness in the Mexican market, which will ultimately benefit consumers.
Prosa ‘s director, Salvador Espinosa, expressed that this transaction will empower them to utilize their capabilities and reinforce their market position. It will broaden their commercial horizons, providing added value to their clients.
Visa’s acquisition of Prosa is anticipated to open avenues for Prosa ‘s partners to offer SMBs new digital payment options, facilitating their expansion by incorporating various Visa products. Through the transformation of transaction data into useful information, these technologies enable companies to improve cardholder experiences overall, maximize revenues and operations, and make well-informed decisions.
Visa sees this deal as an opportunity to expand its global network. Prosa enables the business to provide tokenized transactions and data services. The goal of the additional services that will be progressively added is to improve the e-commerce transaction experiences for both merchants and customers. Visa’s extensive portfolio of AI-powered fraud management solutions will enable this, guaranteeing more dependable and effective transactions for all stakeholders.
When Can You Expect The Visa-Prosa Deal To Close, And What Significance Does It Hold For Visa’s Future Strategy?
Image source: Prosa
The anticipated closure of the deal in the latter half of 2024, contingent upon approval from financial authorities, marks a significant development recently. This follows a thorough investigation by COFECE (Mexico’s Federal Economic Competition Commission) last September, focusing on market concentration within Prosa and other processors. The investigation, which concluded with recommendations for operational adjustments, set the stage for this strategic shift.
Visa’s strategic acquisition of Prosa aligns seamlessly with its overarching vision to enhance and diversify capabilities by harnessing cutting-edge technologies on a global scale. This move positions Visa to propel Prosa ‘s existing solutions into new frontiers through the infusion of innovative digital capabilities. Beyond a mere business transaction, this acquisition signifies a collaborative exchange of expertise, where Visa aims to share its wealth of knowledge in managing a worldwide payments network.
Not only that, but this strategic integration between Visa and Prosa holds promise for the evolution of digital payments in Mexico and beyond, emphasizing a commitment to technological advancement and financial inclusivity on a global scale.
About Visa
Visa is the unparalleled leader in digital payments, orchestrating a revolutionary shift in global commerce. At the heart of its influence lies VisaNet, an advanced global processing network that ensures secure and reliable payments worldwide and can handle over 65,000 transaction messages every second. Fueled by an unwavering commitment to innovation, Visa is a driving force propelling the rapid evolution of connected commerce across diverse devices. This relentless pursuit of progress aligns with a grand vision—a future where cashless transactions become ubiquitous for individuals across the globe.
Visa extends its impact through a diverse portfolio encompassing payment cards, mobile payments, transaction processing services, commercial payments, merchant solutions, and various digital services. Beyond its global reach spanning Europe, the Americas, the Middle East, Africa, and Asia-Pacific, Visa plays a pivotal role in supporting local businesses. Headquartered in the innovation hub of San Francisco, California, Visa’s presence reverberates worldwide, underscoring its commitment to shaping a dynamic, interconnected, and technologically advanced future for global financial transactions.
About Prosa
Prosa is a crucial electronic transaction processor in Latin America, boasting over 50 years of dedication to promoting payment methods. Throughout its history, Prosa has been committed to simplifying financial operations, introducing transparency, and enhancing security. This commitment has earned the company recognition as one of the most innovative entities in Mexico.
Specializing in the financial sector, Prosa is a crucial player in the payment media market. The company provides products that streamline card issuance, facilitate transactions at commercial points of sale, and manage ATM transactions. Its services are predominantly utilized by financial institutions operating in the payment media market. With a robust client base comprising issuers and acquirers, Prosa processes over 10 billion transactions annually through its network.
Conclusion
Visa’s majority stake acquisition in Prosa signifies a strategic leap toward transforming Mexico’s payment sector. The commitment to bolstering digital payments aligns with Visa’s global network strategy, emphasizing innovation and collaboration. The autonomy granted to Prosa and Visa’s expertise promises an enriched digital ecosystem in Mexico. The partnership empowers businesses and consumers through new offerings, real-time transactions, and advanced technology.
The anticipated closure in the latter half of 2024, pending regulatory approval, marks a significant milestone in Visa’s international expansion. Beyond a business transaction, this move fosters a collaborative exchange of expertise. It reflects Visa’s dedication to technological advancement and financial inclusivity on a global scale.
