Visa Inc. ( V Quick Quote V - Free Report) has announced that its Tap to Phone product will now be available in more than 15 markets with plans to expand to the United States and the rest of the world.
Visa Tap to Phone product was piloted last year. Visa today announced product availability in more than 15 markets with plans to expand to the United States and accelerate global product growth in the rest of the world. This product expansion will be done via more than 35 new partners including Visa Ready for Tap to Phone partners.
The roll out of this contactless mode of payment is in sync with Visa’s commitment to digitally-enable 50 million small and micro businesses.
Visa’s Tap to Pay is the latest technological evolution in the payments space. The method is simple, secure and quick and enables cardholders to tap their card at a contactless Point-of-Sale (PoS) terminal to make transactions, rather than 'swiping' or 'dipping' their card into PoS terminals.
Tap to Phone makes it easier for sellers to accept payments via their smartphones. The solution enables sellers to turn their NFC-enabled mobile devices into contactless POS terminals without any additional hardware. Accordingly, sellers can reduce the use of cash, thus facilitating easier accounting, increased access to customers (consumers today are carrying less cash) and increased ticket sizes as a result of a more convenient customer experience. Additionally, Tap to Phone payments are reliable and safe. Therefore, sellers can be confident about their solutions facing little or no risk.
All in all, the Tap to Phone program relieves the traditional pains involved in accepting card payments, such as the need to purchase and install costly physical POS terminals or losing to get on-boarded onto a payment system as well as find an acquiring bank.
Visa’s Tap to pay is already a hit among sellers. More good news is that the number of sellers using this Tap to Phone payment mode also grew 200% over the past year and is now live in numerous countries across Europe, the Middle East, Africa, the Asia Pacific and Latin America. Geographies of recent Tap to Phone launches include Belarus, Malaysia, Peru, Russia and South Africa with the upcoming unveilings planned in Brazil, Italy, the United Kingdom among others.
This innovative service holds immense potential for growth and business opportunity for Visa, given that it can be applied to more than two billion Android devices, globally. Tap to Phone looks promising, particularly for the 180 million micro and small merchants (MSM) around the world, of which less than 10% of MSMs in many emerging markets currently accept digital payments. This shows that the facility is underutilized and offers ample scope for progress. Moreover, per a survey conducted by Visa, 63% of MSMs confirmed that they will likely implement Tap to Phone in their own business transactions while more than 50% of consumers said that they will likely use the facility if offered to them.
Further, this solution is a highly attractive proposition for customers who are not so comfortable in carrying hard cash, given its vulnerability to loss and theft. Also, it is more difficult to track past transactions with cash payment than through card. Additionally, unlike most cards, cash lacks the commonly available reward programs. Accordingly, Tap to Phone solutions can provide consumers with greater abilities to pay small merchants by expanding their acceptance among the small-time sellers so that payment for goods and services can be made in a fast, convenient and secure manner.
The COVID-19 outbreak enabled tap to pay or contactless payments to emerge as a much sought-after facility. Visa saw tap to pay payments grow 40% year over year. In a recent Visa survey, nearly half the consumers (48%) said that they don’t prefer shopping at a store that only offers payment methods requiring contact with a cashier or a shared machine like a card reader, thus making it critical for businesses to expand their acceptance methods beyond cash.
The multiple layers of security offered by Visa Tap to Pay enabled cards makes it compelling for the customers to use as against the current Visa debit card. The high level of alertness ensures that members are not responsible for fraudulent or unauthorized transactions. The card never leaves customers’ hands while making transactions, which reduces the risk of fraud.
Another company in the same space
Mastercard Inc. ( MA Quick Quote MA - Free Report) is piloting the Tap on Phone technology with its partners in more than a dozen markets across six continents. It is also converting Android smartphones into acceptance devices for contactless cards, mobile wallets and even smartwatches with no additional device and setup costs, separate dongles or other hardware required for the remittances.
Visa remained at the forefront of the industry by launching products and solutions, which are technologically efficient and updated to serve the needs of its customers. Its superior services and global payment network enabled it to stay ahead of the other players in the industry.
In six months' time the stock has gained 18.7% compared with its
industry’s growth of 6.1%. Other players in the same space, such as Mastercard, American Express Co. ( AXP Quick Quote AXP - Free Report) and Discover Financial Services ( DFS Quick Quote DFS - Free Report) have gained 29.8%, 25.7%, 85.9%, respectively, in the same time frame.
Visa carries a Zacks Rank #3 (Hold), currently. You can see
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