Mastercard invested $300 million in Corpay’s cross-border unit as part of an agreement making that business the exclusive provider of commercial cross-border payments services for the card network’s bank clients.
The companies disclosed the agreement Tuesday in a press release, saying they have also expanded a prior partnership that will deliver more services to Mastercard’s financial institution clients, and in turn, their corporate customers.
Through the tie, Purchase, New York-based Mastercard will simplify its card and non-card cross-border offering, including large dollar payments, and enhance them with ancillary services, such as currency risk management. That alliance builds on what the release called “their decades-long virtual card collaboration.”
The expanded partnership comes as companies in the industry are seeking to improve and expand in cross-border payments as well as business-to-business payments. Corpay provides an avenue for addressing both aspects with its emphasis on providing payments services for companies’ management of payments.
Cross-border payments have long been notoriously expensive, slow and complicated, but companies and governments around the globe are seeking to accelerate them while cutting costs and reducing complexity. Real-time payments systems that are speeding up payments have increased interest in this shared goal.
Atlanta-based Corpay, formerly known as Fleetcor Technologies, provides payments services through three segments, focusing generally on corporate payments, including the cross-border unit, as well as two others focused on fleet management expenses and lodging expense.
As a result of the investment, Mastercard will have a 3% ownership stake in the business unit and the Corpay business unit is valued at $10.7 billion, the release said.
“Our work with Corpay expands our reach into the large and growing cross-border B2B payments space helping our financial institution partners deliver on the non-carded needs of their commercial customers, simply and efficiently,” Mastercard Chief Commercial Payments Officer Raj Seshadri said in the release.
Meanwhile, Mastercard also said it’s expanding its services for smaller cross-border disbursements and remittances to more small and mid-sized businesses, including to Corpay’s clients. The card network has previously described that business as a way for consumers, businesses or governments to send consumers money, including globally.
Mastercard’s cross-border payments volume grew about 17% last year over 2023, according to the network’s annual filing in February. The filing didn’t provide a dollar figure for that volume.
