The Future of Visa Inc.

In our last post we discussed how Joseph Saunders, the Chief Executive of Visa Inc., foresees the new credit card reform legislation affecting his industry. In this post I think it is important that we also touch on some of the other things that he had to say about the future of the world’s largest credit card company.

While there is no denying that the new credit card legislation will curtail some of the industries profit streams, Saunders seems to be rather confident that Visa is positioned well to offset those losses.

While banks and credit card companies are losing billions of dollars as debt burdened Americans, coupled along with the rising unemployment rate, default in record numbers, Saunders lays out his vision for how Visa will stay competitive.

Saunders believes that the slowdown we are seeing in credit card use will be offset by an increase in the use of debit cards and other forms of electronic payments including gift cards.

While we agree with Saunders thesis, the fact of the matter is that payments in all forms, whether they be credit or debit, has slowed significantly as the economy continues to falter.

While debit cards, for the first time in history, surpassed credit cards as a means of payment in the first quarter of 2009, consumer spending is still way down and that is affecting the bottom line of just about every company in the world.

And lest we forget, this is not a recession that is only occurring in the United States, but rather a global recession the likes of which the world has not seen since the Great Depression.

Saunders went on to state that while he believes, and rightfully so, that people will continue to be concerned about unemployment, there also will come a time when the economy will turn and consumers will once again start buying.

It will be interesting to see when that happens. We here at agree with Saunders. The United States will be back, hopefully bigger and better than ever.

The truly interesting thing will be how much we will go back to relying on credit cards. Will debit card transactions continue to outshadow credit cards or is this just a temporary blowback caused by the current economy? At this point I don’t think anyone really knows, but sooner or later we are all going to find out.

Do Relatives Assume Credit Card Debt

Related Information:

  1. Visa Speaks Out About Credit Card Reform The chairman of Visa Inc. Joseph Saunders spoke a couple of days ago about what the credit card reform act legislation will mean not only to his company but to…
  2. The Future of Credit Cards It is no secret that the recession has hit the credit card industry exceptionally hard. Banks and credit card issuers are scrambling to collect on debts owed to them by…
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  4. Debt Settlement Fraud on the Rise I’m sure this will come as no surprise to you if you have been paying attention to the news at all over the past few months but the United States…