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Global Payments Inc., an Atlanta-based transaction processor, has bought ZAO United Card Service, a Russian Federation merchant acquirer, for $120 million. United Card Service also processes payments indirectly for more than 70 financial institutions and for more than 2,500 ATMs through a deal with Rosbank, a $16.6 billion asset Russian bank. In 2007, United Card Service and Rosbank signed a 10-year marketing deal that provides United Card Service sponsorship into the Visa Inc. and MasterCard Worldwide networks. Rosbank also provides bank referrals to United Card Service. "We expect to see strong growth in the market because it's not as mature as Western Europe [for payments]," Jim Kelly, Global Payments chief operating officer, tells CardLine. "We see Russia as a really strong near-term growth story." Global Payments also sees long-term potential in Russia because the per-capita cardholder rate is 0.5. That compares with 2.6 cards per person in the United States, the company says. Should Russia's economy continue to expand, the per-capita rate and card-usage rates will increase, the company says. Global Payments says the number of credit and debit cards issued in Russia increased to 73.8 million in 2006 from 10.6 million in 2001. The processor also says that slightly more than 2% of Russia's total retail transactions are made with credit and debit payment cards. United Card Service had $34.2 million in revenue in 2007, and the Russian company claims it has 30% of the Russian card-processing volume, says Global Payments, which began operating in Russia in 2006 when it launched a joint venture with Home Credit & Finance Bank of Russia to provide credit-bureau services. Global Payments says the closing date is not known at this time because the deal is subject to noteholder and regulatory approval.
