Nov. 17 (Bloomberg) -- Visa Inc., the world’s biggest payments network, is creating prepaid accounts linked to mobile phones across Africa and the Middle East as it aims to capture transactions from so-called unbanked consumers.
The product will be rolled out on MTN Group Ltd.’s cellular network for 5.7 million customers in a dozen countries, Visa said today in a statement. The offering, initially available in Nigeria and Uganda, is Visa’s first in the region since its $110 million purchase in June of Fundamo, a Cape Town-based provider of mobile-commerce technology in developing countries.
“This leverages the investment we made in Fundamo,” John Partridge, president of San Francisco-based Visa, said in a phone interview. “In these developing countries the majority of people are still unbanked or under-banked. While they don’t have bank accounts, the vast majority have a mobile phone.”
The system, which lets users buy goods, receive payments or withdraw money from automated teller machines, will be the first to connect mobile users to Visa’s network without needing to tie the account to a plastic card. It also may help Chief Executive Officer Joseph Saunders, 65, fulfill his goal of generating more than half of Visa’s revenue outside the U.S. by 2015.
Visa is in talks with officials in emerging markets about disbursing government benefits to the accounts, Partridge said.
This is the beginning of the company’s efforts to enable all Visa cardholders worldwide for mobile payments, said Nick Holland, senior analyst at Yankee Group in Boston. Visa previously introduced a so-called digital wallet to ease the transition to mobile commerce.
“This is indicative of mobile payments going mainstream,” Holland said in a phone interview before the announcement. “Fundamo is a powerhouse.”
Visa, which derived 44 percent of its revenue from outside the U.S. in the fiscal fourth-quarter, processed 50.9 billion transactions valued at $5.87 trillion in the year ended Sept. 30, the company said in a statement last month.
In the past decade, 100 million people have gotten access to previously unavailable banking services through mobile devices, Visa said in the statement, which cited 2011 data from Juniper Research.
Visa fell 2.1 percent to $93.40 yesterday. The shares have climbed 33 percent this year.
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