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Visa Sees 17% Growth In Global Sales Volume
Visa reported that its global sales volume has surpassed US$2.3 Trillion for the year ending June 30 2002, an increase of 17% on the previous year. Retail sales using a Visa card now account for 7% of global personal consumer expenditure (PCE), a figure that the payment organization expects to increase to at least 12% by 2010.
“It is very encouraging that, despite the downturn in the global economy over the past year, we continue to see strong double-digit growth, which reflects the value and convenience of electronic payments, ” said Malcolm Williamson, President and CEO of Visa International. “We are confident that we can obtain a 12% share of personal consumer expenditure by the end of the decade.”
Personal consumer expenditure represents the market value of all goods and services purchased by households and non-profit institutions, excluding house purchases. Today global PCE is at US$19 Trillion and is comprised primarily of cash and check payments. Visa has seen an average annual increase in its share of global PCE of 12% over the past five years.
In selected domestic economies, Visa’s share of PCE is particularly high. For example, including retail sales and cash withdrawals, 68% of PCE in Iceland is on Visa cards, in South Korea the figure is 57%, and in the UK it is 27%.
“ePayments, and Visa products in particular, offer a wide range of benefits to consumers, merchants and businesses, including a choice of how and when to pay, enhanced security and global utility,” said Malcom. “It is these benefits along with continued innovation and our partnership with Visa member financial institutions that will continue to drive the growth of Visa products.”
One of the major growth areas for Visa continues to be in debit cards. Visa worldwide debit sales volume surpassed US$1 Trillion for the year ending June 30 2002, an increase of 22% on the previous year. In the US, the number of Visa debit (cheque) card transactions exceeded Visa credit card transactions for the first time from January through June 2002. During this period, Visa USA processed 3.04 Billion Visa retail debit card transactions compared to 2.96 Billion credit card transactions despite the fact that the number of credit cards more than doubled that of debit. Worldwide, Visa debit card transactions grew at over twice the rate of Visa credit card transactions.
Another growth area is in prepaid card products, such as payroll cards, gift cards, and money transfer cards. Visa estimates that the global market opportunity for prepaid products stands at over US$2 Trillion.
In the credit card market, Visa saw growth of 12% globally with total sales volume of US$1.24 Trillion for the year ending June 30, 2002.
Regionally, strongest growth continues to be in emerging markets. Visa Asia Pacific saw a 42% increase in overall sales volume while in Central and Eastern Europe, Middle East and Africa Visa saw a 37% increase. Worldwide, there are currently over 1.2 Billion Visa payment cards accepted at more than 29 Million physical locations including 800,000 ATMs.
Contributing factors in the growth of Visa global sales volume include:
- An increase in the number of merchant outlets that accept Visa. For example, in the US, acceptance in quick service restaurants has grown by 60% while merchants that accept recurring payments, such as utility bills, have increased by 25%.
- New co-branded cards, such as the Payback Visa card in Germany and the Target Visa card in the US.
- Launch of new payroll programmes in the US and Eastern Europe.
- Usage promotions surrounding Visa’s sponsorship of the 2002 Winter Olympic Games.
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