Karta, the Australian-based fintech back by Commonwealth Bank of Australia, has inked a multi-year agreement with Visa. Specifically, Karta will be the first-ever non-bank private label issuer in the US to process transactions on VisaNet.

Karta says that the collaboration will bring innovation to merchants and consumers alike via VisaNet.

The relationship with Visa marks an important milestone for Karta. Karta has developed a mobile-first solution that lets shoppers scan, select and buy gift cards in seconds from any participating retailer digitally and physically. Every business that accepts VISA can gain an instant and robust revenue channel. Karta is API based, core-independent and highly scalable.

‘Tip of the iceberg for gift cards’

“We are at the tip of the iceberg for gift cards, a perennial and increasingly favourite consumer shopping channel. Visa’s network with Karta’s innovative technology, can allow Karta to advance the consumer gift card experience by leaps and bounds. It’s a boon for VISA merchants. They will be able to issue gift cards that consumers like and can instantly use. They are digitally secure and also deliver a treasure trove of insightful shopping preference data. A win-win for all stakeholders,” said Liza Gillooly, Global Director of FinTech BD Visa.

Laura Long, Senior Director, Network Applications at Visa, added: “VisaNet is the global network at the heart of Visa. It connects more than 80 million merchants in 200+ countries. In partnership with Karta, we can leverage this infrastructure to create new and innovative solutions that can change how the world gifts.

When gift cards and stored-value solutions are core to a retailer’s or brand’s digital strategy, they improve cash flow, says Karta. Some 65% of gift card holders spend an extra 38% beyond the card’s face volume, according to the National Retail Federation Gift Card Spending Survey.

Perfect example of incumbent and disruptor collaboration

“Karta and Visa are ushering in a historic new era in gift cards. It’s pretty simple. Existing solutions can be slow, require integrations and can be structurally expensive. For consumers, gift cards are typically pieces of plastic or paper vouchers that are easily lost. Purchase them online or in-store and use them just like a debit or credit card. Visa and Karta will deliver a game-changer for consumers and businesses alike,” said Karta co-founder Clare Kinsey.

Karta co-founder David Anderson added: “This historic deal is almost two years in the making. We couldn’t be more appreciative and thankful to every person at Visa who has helped to make this possible. This is the perfect example of incumbents and disruptors leaning in together and innovating.”