Payment processing company Braintree has acquired Venmo, a startup that allows users to send and receive money, for $26.2 million, according to The New York Times. The acquisition is intended to help Braintree continue expanding into the rapidly growing mobile payments market.

Before the takeover agreement, Braintree had solely been focusing on business-to-business transactions, supporting more than 2,000 companies with its payment processing services. Venmo is a more consumer-facing business, according to GigaOM, allowing the parent company to add new clients and target industries to its fold.

Braintree's software is used by companies to process credit cards on e-commerce transactions for more than 3,000 websites. Integrating Venmo's technology into their software, users with existing accounts will be able to pay for items and online transactions through their mobile phones, using Venmo's text-based payment system. The new mobile payment capabilities could help Braintree compete with larger rivals in the online payments field, including Google and PayPal.

"PayPal was built 10 years ago for Web browsers," Bill Ready, the chief executive of Braintree, told the news source. "It hasn't really updated the way people take payments. The shift to mobile is coming and it is coming very quickly."

According to GigaOM, he company currently does more than $4 billion per year in processing volume, due in large part to several big-name clients like Rovio. Although most of these revenues were brought in through the online portal, approximately $1 billion was processed through mobile devices, a payment option that was growing at a substantially faster rate than the company's online commerce business.

By acquiring Venmo, Braintree will not only be better positioned to continue capitalizing on the burgeoning mobile payments market, but can also profit from Venmo's existing client base. Welcoming a peer-to-peer payment database under its umbrella could portend significant growth in the near future.