FIS plugs into Visa's distributed ledger to speed B2B transactions
Less than a day after saying it would work with large core processors in a consolidating industry, Visa has struck a deal to link its B2B platform to FIS' bank clients.
Called B2B Connect, Visa's product uses a distributed ledger to shorten transaction times from several weeks to one or two days. About half of B2B payments are still made with checks, and Visa has invested heavily in automating business payment rails, including an investment in companies such as Behalf, a fintech that automates sourcing for small businesses that purchase from e-commerce companies.
FIS will integrate its business payment technology with B2B connect to enable FIS and Visa's overlapping bank clients to send B2B transactions directly to and from the sending and receiving bank.
This is designed to remove intermediaries that can slow supply chain finance, as well as extract extra fees, using the distributed ledger in a manner similar to how distributed ledgers remove correspondent banks for international payments.
The announcement also follows quickly on Visa CEO Aldred Kelly's promise to work with companies such as FIS and Fiserv, which have sparked a wave of consolidation in the payments industry with large mergers in the past few months.
During Visa's second quarter earnings call, Kelly said he has been communicating with executives from FIS, Worldpay, Fiserv and First Data on possible synergies that could fuel collaboration.