Visa reported fiscal first quarter results that showed continued strides in new payment flows, including Visa Direct and contactless payments.
Payments volume for the three months ending Dec. 31 increased 7% over the prior year on a constant-dollar basis.
Cross-border volume, excluding intra-Europe, was up 31%. As had been seen with payments network peer Mastercard, travel-related and cross-border spending saw a strong snapback amid a boost in travel.
Visa said in its supplemental filings that credit volumes, in constant dollar terms, was up 11%, to $1.5 trillion, outpacing debit, which grew 3%, to just under $1.5 trillion.
Total Visa card counts were up 8% year on year to 4.1 billion cards. The number of debit cards grew by 8%, outpacing credit card growth of 6%.
CEO Al Kelly, who, as reported last year is stepping down to be replaced by president Ryan McInerney, said that within consumer payments, credentials grew 11%, excluding Russia — “with strong double digit growth in the United States, India and Brazil.”
He noted that tap-to-pay penetration of face-to-face transactions was 72%, excluding Russia and the U.S. He added that within the U.S., certain verticals are seeing significant uptake of contactless payments, as U.S. drug stores were above 40% penetration for the first time.
New payment flow related revenues were up more than 20%, said Kelly, with strong growth seen in B2B payments volume and Visa Direct transactions. With a specific nod to Visa Direct, he said the real-time push payment offering logged 1.9 billion transactions in the fiscal first quarter, up 39% year on year. Non-U.S. Visa Direct transactions, said Kelly, grew by roughly 20 percentage points.
B2B commercial payments volume grew 15% year on year, he said.
CFO Vasant Prabhu said that U.S. payments volume was up 9% year over year and 44% over 2019 in constant dollars in a sign of continued consumer resilience. U.S. card present spend was 26% higher than the company’s 2019 levels. U.S. card-not-present volume, he said, was 65% higher than 2019.
“The cross-border travel recovery continues, however, as expected the pace of recovery has moderated as most borders are now open, including Japan in October and now China in January,” he told analysts.
And in terms of the outlook for the current quarter, Prabhu said, “we are assuming that trends in domestic payments volumes and processed transactions are sustained with some benefit overlapping Omicron in January of last year.”
And as he noted later in the call, Prabhu added that Visa has “demonstrated strong consumer payments, growth digitization, and client wins, new flows and value added services. Momentum remains very strong,” despite an uncertain macro environment.
Debit has stayed resilient, management noted on the call, and has been among the biggest beneficiaries of the push to digitization — even as credit has recovered. The company will focus extending Visa Direct into new geographies and use cases, according to the call, into gig economy payouts and remittances.
As Kelly said on the call, “there is tremendous opportunity in traditional card world, both in the consumer space as well as the B2B space. There are still hundreds of millions of people to bring it to the financial mainstream. There are still trillions of dollars spent on cash and check. And when you look in the B2B space, we see a total addressable market of about $120 trillion across card opportunities, cross border and payables and receivables.”
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