Cielo has agreed to collaborate with Banco do Brasil to create a BRL11.6bn ($4.5bn) worth joint venture for managing the bank’s debit and credit card payments.

The new company will be responsible for support activities related to cards management including management of payment accounts, support to the security management and control of transactions, and payment of brands and payment arrangements fees.

The joint venture will serve the purpose of making associations with other partners, generating additional revenues.

Banco do Brasil will continue to look after marketing, credit analysis and granting, cardholder relationship, clients activation and credit risk services.

Cielo will provide BRL 8.1bn ($3.15bn) through the sale of debt while retaining 70% of the joint venture’s capital whereas Banco do Brasil will hold 30%.

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The conclusion of the deal will be subject to compliance with the negotiation and signature of complementary documents contemplating specific aspects of the joint venture operation, for obtaining authorization from the Brazilian Central Bank.