Airwallex, the fintech unicorn backed by Tencent Holdings and Sequoia Capital China, is teaming up with Visa to offer a "borderless" virtual card for businesses in Hong Kong as competition for business-to-business payments intensifies.
The card will allow customers in Hong Kong to generate single-use and multi-use cards for online payments to vendors and other merchants in more than 140 currencies where Visa is accepted. It is not a traditional credit card, but instead linked to a business's Airwallex account.
"Demand for virtual cards has been accelerating as businesses look for a modern solution to not only transact money, but to also control their finances, optimise spending and enhance their security and protection," said Kai Wu, Airwallex's CEO for Greater China.
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The "borderless" product will come into direct rivalry with other operators, including a venture between HSBC and Mastercard that offers a similar card to business customers in the financial hub as the Covid-19 pandemic accelerated and multiplied e-commerce transactions.
Airwallex has seen its valuation nearly triple in the past two years to US$2.6 billion, following a Series D fundraising round in March. The firm's other financial backers also include San Francisco-based Greenoaks Capital, Australia's Grok Ventures and Hong Kong tycoon Li Ka-shing's Horizons Ventures that focuses on disruptive technology and start-ups.
Founded in Melbourne in 2015, Airwallex employs more than 600 people in 12 offices globally. The firm has created "hundreds of thousands of virtual cards" for its business customers since its introduction in Australia in February 2020, Wu said. Hong Kong is the third market where the service is being offered globally.
The virtual card uses can range from companies seeking to make a one-time payment to a single vendor, to recurring payments for web services, online advertising or other subscription-based services, he added. The Airwallex offering is the latest business-to-business (B2B) product introduced under a strategic partnership reached last year between the fintech and global payments technology company Visa.
The Airwallex offering is the latest B2B product under a strategic partnership reached last year with global payments technology company Visa.
"Why is this of interest to Visa? I think Airwallex and Visa share the philosophy around embracing innovation," said Maaike Steinebach, Visa's CEO for Hong Kong and Macau. "In the B2B space, there's still a lot of room for innovation. We are really looking at this area as a new frontier of payments."
In May, Airwallex separately introduced an online card payment acceptance product for local merchants to accept card payments via the Visa and Mastercard networks. It's focusing next on the Southeast Asian market where financial infrastructure was lagging behind.
"With the penetration of the online economy and the growth of the local economy, the boost of the online financial infrastructure is very, very fast," Wu said. "We hope to partner with Visa in those emerging areas to work with local businesses."
"The pain points in business payments have been even bigger and more complicated than consumer payments," he added. "It is very important for us to partner with strong financial infrastructures, such as the likes of Visa."
More from South China Morning Post:
- Airwallex's value swells to US$2.6 billion as Greenoaks leads investors to add US$100 million to fintech start-up's Series D round
- Fintech unicorn Airwallex raises US$200 million capital in US expansion plan to compete with Stripe
- Tencent-backed Airwallex to join push for Hong Kong virtual bank license
- Tencent looks to cross-border payments expansion after leading US$13m funding in Airwallex