Visa Inc. operates as a payments technology company worldwide. The company facilitates digital payments among consumers, merchants, financial institutions, businesses, strategic partners, and government entities. It operates VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions. In addition, the company offers card products, platforms, and value-added services. It provides its services under the Visa, Visa Electron, Interlink, VPAY, and PLUS brands. Visa Inc. was founded in 1958 and is headquartered in San Francisco, California. The company is publicly listed on NYSE under the ticker “V”.
During the last few years, we experienced a widespread shift in how people shop and pay for goods. The trend towards cash digitalization was already visible, but Covid just accelerated it, through the spread of e-commerce, tap-to-pay and contactless payments even in that part of the population that resisted until then. Furthermore, recently there was a tremendous growth in less traditional payment approaches, such as person-to-person transaction and Buy Now, Pay Later (BNPL) installment plan. All of this is beneficial to Visa, as the company is well positioned to take advantage of these trends by offering a payment network with scale, security and good reputation.
We can easily say that digital payments, and general comfort with technology, is increasing rapidly: indeed, according to Business Insider Intelligent estimates, mobile point-of-sale (mPOS) payments are expected to increase 23.9% annually by 2024. The trend is confirmed also by the fact that Visa volumes, at the moment, are exceeding their pre-Covid levels. In fact, compared to Q1FY20, and excluding China, where volumes are distorted by the loss of low-margin dual-brand volumes, Payments Volume in Q1FY22 was 31% higher globally, compared to 26% in Q4FY21. More specifically, it was 32% higher in the United States, and 29% higher outside the United States. Credit Volume in Q1FY22 was helped by spending increases among affluent consumers and small businesses, and Debit volume continued to be strong even as Credit recovered. High-margin cross-border volumes have continued to recover and exceeded expectations.
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