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Global Payments Inc. early Monday announced it will make its Netspend prepaid card services available via Amazon Web Services. While reporting a strong performance for the June quarter, the Atlanta-based processing company also said it is acquiring from Spain’s Caixabank the payments businesses of the bank’s Bankia unit.
The move is expected to give Global a jump on what it sees as a high-growth Spanish market, company officials said.
These officials shrugged off potentially stepped-up competition in the acquiring business from a newly aggressive PayPal Holdings Inc. and said Global’s $830-million acquisition of real-estate payments processor Zego Inc., announced in early May, has closed. A separate deal, for Worldline S.A.’s Austrian acquiring business, PayOne, also announced in May, is expected to close later this year.
Meanwhile, the company heralded a strong quarter for both its acquiring and issuing businesses as it fended off the dampening effects of Covid 19. “Rather than impede our strategy, the pandemic spurred further share gains,” chief executive Jeff Sloan told equity analysts during a presentation of the company’s second-quarter results.
The transition of Netspend’s issuing capabilities to AWS is expected to help extend the unit’s services into international markets and ease its adoption by fintechs and neobanks, Sloan told equity analysts on the call. Global a year ago agreed to develop cloud-based issuer services with AWS. Global now has filed 20 letters of intent on behalf of clients with AWS, up from four at the start of the year, Sloan said. Netspend came to Global as part of its $21.5-billion acquisition of Total System Services Inc. in 2019.
Meanwhile, recent moves by PayPal to rejigger its pricing and bring its Zettle point-of-sale technology to the U.S. market left Sloan unmoved. “Zettle has been at the point of sale for a long time [in Europe], yet our businesses outperformed for a long time. [PayPal] is a great company, but it doesn’t change our strategy one iota,” he told the analysts.
For the quarter, Global recorded revenue of $2.14 billion, up 28% year-over-year. Revenue for the first half of the year totaled $4.13 billion, a 15.4% rise over a year ago. The worst effects of the pandemic industrywide began to be felt during the second quarter of 2020. The engine for much of Global’s growth came from the company’s merchant-solutions unit, the largest of its three divisions. The division reached $1.43 billion in revenue, up 43%.
Sloan took the opportunity to refute critics of the company. “Over the last eight years, some said our best days were behind us. The facts say the opposite,” he said. “We grew right through the pandemic.” He added, “We believe the best is yet to come.”
