In an effort to provide its digital service in Latin America, Visa Inc. (V - Free Report) has entered into an agreement with YellowPepper — a pioneer in mobile payments. This investment will be the first of its kind in the region and reflects the company’s concerted effort in enhancing its digital capabilities.
With this agreement, Visa intends to focus on growing opportunities for tokenized payments, increasing access to Visa APIs, and expanding the usage of push payments via Visa Direct.
YellowPepper has been the chosen one for Visa, given the former’s extensive experience in the region and strength of their existing client base, which would provide a jump start to Visa’s payments business.
This agreement will make YellowPepper a Visa Token Service Provider, allowing it to offer Visa’s secure, digital payment token services, via any Internet connected device.
Visa has targeted the Latin American region, which has relatively lagged the other countries in mobile payment adoption. The market remains largely underpenetrated and thus provides abundant scope for Visa’s growth.
With YellowPepper, Visa is seeking a global strategy to reach to new partners and customers.
Mobile payment adoption is growing given its ease of use and enhanced security. A number of ways by which a mobile can be used for payments include near-field communications (NFC), mobile wallets, SMS and wireless application protocol. Mobile is the future of payments and companies like Mastercard Incorporated (MA - Free Report) , Visa, PayPal Holdings, Inc. (PYPL - Free Report) are beefing up their investments in the mobile payments’ technology.
In the past year, Visa’s shares have added 40% compared with the 35% growth by the industry. The outperformance reflects the company’s strong business growth and value accretion from acquisitions and numerous partnership and tie-ups.
Visa carries a Zacks Rank #2 (Buy). Another stock with the same Zacks Rank as Visa is Alliance Data Systems Corp. (ADS - Free Report) .
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Alliance Data beat estimates in two of the last four quarters, with an average positive surprise of 2.15%.
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