We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Visa (V) to Purchase Tink to Boost Open Banking in Europe
Read MoreHide Full Article
Visa Inc. (V - Free Report) has announced that it will acquire Tink, a European open banking platform, which is a third-party provider innovating and creating products and services by using customer data held by banks.
The deal will be valued at $2.2 billion. The move resonates with Visa’s efforts to be part of the Open-Banking innovation, which is being adopted by banks at a rapid rate.
What's Open Banking?
Visa states that open banking refers to the use of APIs (Application Programming Interfaces) to share clients’ financial data (with their consent) to trusted third parties. In short, an account holder’s bank details are shared in a secure way, only with their consent. This data is then used by third-party providers to create and distribute novel financial products and services for account holders.
In open banking, consumer’s data is analysed to gain a deeper understanding of their behaviors and preferencesThese are then used to create personalized solutions and services for them.
The idea behind open banking is to provide a much higher level of customization and personalised services at a much lower cost or no cost at all.
Open banking framework is aimed at making it convenient for clients to get all the information regarding bank accounts, cards and credit plus latest transactions and new services via an app.
Big-Time Adoption of Open Banking in EU
In European Union (EU), banks are mandated to transition to open banking to foster innovation and empower consumers. But the main hindrance to open banking is customers’ apprehension to share their details because of the fear of identity theft and monetary loss.
A reliable and trusted source can ally these pressing concerns of customers. Companies like Visa and Mastercard with their robust security systems can offer much help.
According to Visa, trust in the financial institution, consumer education and consent, and the ability to transparently monitor and control the usage of data are the critical pillars to ensure success in open banking.
Tink Will Give Visa Exposure to the Vast Open Banking Space
Tink has an established market presence in Europe. It is integrated with more than 3,400 banks and financial institutions, and has access to millions of bank customers across the region. Tink enables banks and other financial firms to share and access consumer financial data more seamlessly.
This move by Visa shows its intent to make it big in the open-banking space, which is catching up fast. It will float a new revenue stream for the company. Visa had earlier attempted to acquire Plaid, an open-banking platform in the United States, but the deal was blocked by regulators over concerns that it will help Visa exercise a monopoly in the digital debit card space.
Another company in the same space, Mastercard Inc. (MA - Free Report) , is also trying to further its position in the open-banking space via the Mastercard Open Banking Connect system.
Visa is one of the leading companies in the payment processing space, the others being Discover Financial Services (DFS - Free Report) and American Express Co. (AXP - Free Report) .
Year to date, Visa has gained 7.3% compared with the industry’s growth of 1.92%.
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Image: Bigstock
Visa (V) to Purchase Tink to Boost Open Banking in Europe
Visa Inc. (V - Free Report) has announced that it will acquire Tink, a European open banking platform, which is a third-party provider innovating and creating products and services by using customer data held by banks.
The deal will be valued at $2.2 billion. The move resonates with Visa’s efforts to be part of the Open-Banking innovation, which is being adopted by banks at a rapid rate.
What's Open Banking?
Visa states that open banking refers to the use of APIs (Application Programming Interfaces) to share clients’ financial data (with their consent) to trusted third parties. In short, an account holder’s bank details are shared in a secure way, only with their consent. This data is then used by third-party providers to create and distribute novel financial products and services for account holders.
In open banking, consumer’s data is analysed to gain a deeper understanding of their behaviors and preferencesThese are then used to create personalized solutions and services for them.
The idea behind open banking is to provide a much higher level of customization and personalised services at a much lower cost or no cost at all.
Open banking framework is aimed at making it convenient for clients to get all the information regarding bank accounts, cards and credit plus latest transactions and new services via an app.
Big-Time Adoption of Open Banking in EU
In European Union (EU), banks are mandated to transition to open banking to foster innovation and empower consumers. But the main hindrance to open banking is customers’ apprehension to share their details because of the fear of identity theft and monetary loss.
A reliable and trusted source can ally these pressing concerns of customers. Companies like Visa and Mastercard with their robust security systems can offer much help.
According to Visa, trust in the financial institution, consumer education and consent, and the ability to transparently monitor and control the usage of data are the critical pillars to ensure success in open banking.
Tink Will Give Visa Exposure to the Vast Open Banking Space
Tink has an established market presence in Europe. It is integrated with more than 3,400 banks and financial institutions, and has access to millions of bank customers across the region. Tink enables banks and other financial firms to share and access consumer financial data more seamlessly.
This move by Visa shows its intent to make it big in the open-banking space, which is catching up fast. It will float a new revenue stream for the company. Visa had earlier attempted to acquire Plaid, an open-banking platform in the United States, but the deal was blocked by regulators over concerns that it will help Visa exercise a monopoly in the digital debit card space.
Another company in the same space, Mastercard Inc. (MA - Free Report) , is also trying to further its position in the open-banking space via the Mastercard Open Banking Connect system.
Visa is one of the leading companies in the payment processing space, the others being Discover Financial Services (DFS - Free Report) and American Express Co. (AXP - Free Report) .
Year to date, Visa has gained 7.3% compared with the industry’s growth of 1.92%.
Visa carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>