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Visa (V) Records Jump in Token Service, Outruns Physical Cards
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Visa Inc. (V - Free Report) recently announced that the company has issued more than 4 billion network tokens globally via its Visa Token Service (VTS). This has outrun the company’s total number of physical cards in circulation around the world.
The Visa Token Service security technology replaces 16-digit Visa account numbers with a digital token. As Visa is the only company that can unlock this token, the delicate account information of customers will be inaccessible to fraudsters. Furthermore, the VTS technology is expected to smoothen the paying experience.
Adoption of the VTS technology has snowballed due to the pandemic. Visa launched VTS in 2014 and by 2020 it had issued 1 billion tokens. It reached the 2 billion milestone in 2021 and now has more than 4 billion tokens issued. Per Visa, e-commerce volume jumped more than 50% since the beginning of the pandemic. With the demand for online payments rising, security threats were a major concern. As such, Visa’s efforts to improve security are praiseworthy.
The company’s analysis showed that the VTS has led to a 28% decline in fraud rates across 800,000 merchants and 8,600 issuers. The lower fraud rates enable merchants to save money on security-related costs and increase approval rates. The analysis witnessed a 3% jump in approval rates due to VTS. This helps merchants to address higher demand from customers.
Visa continues to invest in technology to further boost its already leading position in the payments market and minimize the impact of fraud, and protect consumer and merchant information. Apart from VTS, VisaNet, Visa Direct, and Visa Checkout are some of the platforms that have been developed by the company in recent years to advance its digital platform. The company is also pushing technologies, including contactless and scan-to-pay, tap-to-pay, and secure remote commerce, which can gain more popularity in the future.
Price Performance
Shares of Visa have decreased 4.6% in the year-to-date period compared with the industry’s 9.6% decline.
Headquartered in Oakland, CA, Marqeta provides card issuing and transaction processing services. The Zacks Consensus Estimate for Marqeta’s 2022 bottom line indicates 13.3% year-over-year growth.
Based in Montevideo, Uruguay, DLocal operates an international payments platform. The Zacks Consensus Estimate for DLO’s 2022 earnings indicates 68% year-over-year growth.
Miami, FL-based International Money Express works as a money remittance services company globally. The Zacks Consensus Estimate for IMXI’s 2022 bottom line indicates 18.4% year-over-year growth.
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Visa (V) Records Jump in Token Service, Outruns Physical Cards
Visa Inc. (V - Free Report) recently announced that the company has issued more than 4 billion network tokens globally via its Visa Token Service (VTS). This has outrun the company’s total number of physical cards in circulation around the world.
The Visa Token Service security technology replaces 16-digit Visa account numbers with a digital token. As Visa is the only company that can unlock this token, the delicate account information of customers will be inaccessible to fraudsters. Furthermore, the VTS technology is expected to smoothen the paying experience.
Adoption of the VTS technology has snowballed due to the pandemic. Visa launched VTS in 2014 and by 2020 it had issued 1 billion tokens. It reached the 2 billion milestone in 2021 and now has more than 4 billion tokens issued. Per Visa, e-commerce volume jumped more than 50% since the beginning of the pandemic. With the demand for online payments rising, security threats were a major concern. As such, Visa’s efforts to improve security are praiseworthy.
The company’s analysis showed that the VTS has led to a 28% decline in fraud rates across 800,000 merchants and 8,600 issuers. The lower fraud rates enable merchants to save money on security-related costs and increase approval rates. The analysis witnessed a 3% jump in approval rates due to VTS. This helps merchants to address higher demand from customers.
Visa continues to invest in technology to further boost its already leading position in the payments market and minimize the impact of fraud, and protect consumer and merchant information. Apart from VTS, VisaNet, Visa Direct, and Visa Checkout are some of the platforms that have been developed by the company in recent years to advance its digital platform. The company is also pushing technologies, including contactless and scan-to-pay, tap-to-pay, and secure remote commerce, which can gain more popularity in the future.
Price Performance
Shares of Visa have decreased 4.6% in the year-to-date period compared with the industry’s 9.6% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Visa currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader Business Services space are Marqeta, Inc. (MQ - Free Report) , DLocal Limited (DLO - Free Report) and International Money Express, Inc. (IMXI - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Headquartered in Oakland, CA, Marqeta provides card issuing and transaction processing services. The Zacks Consensus Estimate for Marqeta’s 2022 bottom line indicates 13.3% year-over-year growth.
Based in Montevideo, Uruguay, DLocal operates an international payments platform. The Zacks Consensus Estimate for DLO’s 2022 earnings indicates 68% year-over-year growth.
Miami, FL-based International Money Express works as a money remittance services company globally. The Zacks Consensus Estimate for IMXI’s 2022 bottom line indicates 18.4% year-over-year growth.