Visa has today sweetened its offer for payment company Earthport to about £247m, pushing past rival Mastercard's earlier bid and setting up a showdown for the assets. 

Visa has offered 37 pence in cash for each Earthport share, a 23% premium to its initial bid and 12% higher than Mastercard's offer last month. 

Earthport shares have risen more than five-fold to 38.80 pence since Visa first offered to buy the company. 

Earthport, which had backed the Mastercard bid, said it was now recommending that shareholders accept the increased Visa offer. 

Mastercard said it was considering its options and urged Earthport shareholders to take no action in response to Visa's announcement today. 

Both Visa and Mastercard have cited the same reason for their interest in Earthport - the deal would allow it to expand its cross-border network service. 

Payment processing has become one of the hottest areas for deal making in the last two years, driven by technological changes in the way consumers pay for products. 

Earthport's shares had fallen 28% last year until the first bid.

The company offers a lower-cost option to traditional payments systems by allowing banks and money transfer firms to have a single relationship instead of multiple ties with various payments channels around the world.