SBI is teaming up with Visa International and Elavon (Source) to jump start SBI's acquiring business. It is a critical win for Visa. In light of SBI being the 800# gorilla in the India, their choice of Visa is intriguing. Is this the beginnings of Visa's aspirations in the acquiring space? When Visa decided to acquire CyberSource, Visa was expected to be measured in its interaction with the merchant community so as to not offend its partners, the acquiring banks and processors. With Visa's intentions of taking CyberSource international, and its move into acquiring business in emerging markets, we might seeing elements of Visa's strategy for the coming decade (at least in emerging markets). With SBI's interests in mobile payments (primarily driven by financial inclusion and branchless banking initiatives), Visa's JV with SBI becomes even more significant.
Look forward to your comments on the implications of the SBI-Visa JV.