Nigeria’s digital payments firm Interswitch said Visa has acquired a minority equity stake in the firm, TechCrunch has reported.
“The investment makes Interswitch one of the most valuable African fintech businesses with a valuation of $1 billion,” Interswitch said in a press statement.
The Visa investment could create the first of two market distinctions for Interswitch — as it shouldn’t change the Lagos based company’s plans to go public.
“An IPO is still very much in the cards; likely sometime in the first half of 2020,” a source with knowledge of the situation told TechCrunch on background.
Interswitch did not reveal the amount of Visa’s investment and would not confirm Sky News reporting Monday that pegged it at $200 million for 20%.
Whatever the exact number, Interswitch’s confirmation of a $1 billion valuation marks another milestone in African tech.
Only e-commerce venture Jumia — had generated enough revenue and capital to achieve a ten-figure valuation. But the firm’s valuation had since fallen below the billion mark.
Founded in 2002 by Mitchell Elegbe, Interswitch pioneered the infrastructure to digitize Nigeria’s then predominantly paper-ledger and cash-based economy.
The company now provides much of rails for Nigeria’s online banking system that serves Africa’s largest economy and population. Interswitch offers a number of personal and business finance products, including its Verve payment cards and Quickteller payment app.
From its home-base of Nigeria, Interswitch has expanded to Uganda, Gambia and Kenya.
Interswitch also sells its products in 23 African countries and launched a partnership in August for its Verve cardholders to make payments on Discover’s global network.
Visa and Interswitch are touting the equity investment as a strategic collaboration between the two companies, without a lot of detail on what that will mean.
“The partnership will create an instant acceptance network across Africa to benefit consumers and merchants,” Interswitch said in the press release.