Global payments and technology firm Mastercard Inc. announced on Wednesday that it has entered into an agreement to purchase a minority stake in MTN’s $5.2 billion fintech business.
Mastercard’s strategic investment in the African telecommunications and digital services provider’s fintech business will be made via its newly launched venture capital fund, Mastercard Ventures.
The major investment, which will be Mastercard’s largest in Africa to date, will enable the firm to expand its reach and capabilities in the rapidly growing digital payments segment of the continent.
MTN, a leading digital lifestyle and E-commerce platform in the Middle East and Africa, has an extensive portfolio of innovative fintech solutions, including its money transfer platform, digital banking services, and mobile payments.
The planned investment will give Mastercard access to MTN’s existing infrastructure and business, as well as its current customer base, which includes more than 200 million users across the region. The agreement will also reportedly provide Mastercard with the opportunity to extend its footprint and help drive the increased digitization of payments and financial services in the region.
The move is likely to further strengthen MTN’s existing footprint and capabilities in the payments and financial services space.
“This investment in Africa underscores Mastercard’s commitment to the region’s customers and partners, while helping to foster new opportunities for digital business growth,” said Ann Cairns, Chairman of Mastercard, in a statement.
The partnership is expected to benefit mobile operators and financial institutions across African markets, offering access to advanced payments solutions and capabilities.
“At MTN, we are committed to driving innovation and enhancing digital experiences for our customers. This strategic investment will help us accelerate our digital journey, allowing us to leverage Mastercard’s global expertise and develop solutions that will ultimately benefit our customers,” said MTN CEO Rob Shuter.
The agreement is expected to be completed by the end of 2021 and is subject to various regulatory approvals.
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