MIAMI – Visa Inc. continues to forge ahead with efforts to revolutionize payment systems, partnering with Latin American financial technology (fintech) companies as part of a connect-and-cooperate strategy to compete in a digital era dominated by mobile devices.
“What we do is connect to those companies just like we connect the banks historically and make it easy to do payment on all these new devices,” Jim McCarthy, Visa’s executive vice president for innovation and strategic partnerships, told EFE.
These partnerships with emerging companies, or start-ups, is a key part of the American financial services giant’s digital strategy, which also has led it to team with tech giants to incorporate Internet of Things (IoT) innovations into its services.
Visa partners with companies such as Apple, Google, Facebook and Samsung to facilitate Visa payments on those devices, providing consumers with additional safe payment methods, the executive said.
Visa has 3.4 billion cards in circulation, according to McCarthy, who said that if the company can connect them with 20 billion IoT devices that would facilitate a wide range of purchases, from refrigerators to automobiles.
“So Visa has historically all been about cooperation,” the executive said, adding that Visa works with a total of 17,000 financial institutions and connects 3 billion consumers with 40 million merchant outlets.
“In Latin America there are many companies that are doing things in market to meet consumers’ needs and help consumers connect with merchants in new ways, and so we’re now partnering with fintech,” McCarthy said.
In that regard, Allen Cueli, Visa’s vice president of fintech relations for Latin America and the Caribbean, said there are around 700 fintech companies in the region, two-thirds of which have sprung up in the past two years.
“So there’s a lot of momentum for them. Smartphone penetration is exploding in the region,” Cueli told EFE.
Both executives expressed enthusiasm about the innovative ideas of the Latin American entrepreneurs who participated in Visa’s Everywhere Initiative, a global start-up competition for which a regional winner was chosen Thursday from among 10 finalists.
Among those finalists from Brazil, Argentina, Mexico, Colombia and Chile, there are mobile platforms and applications that range from facial recognition technology to others that encourage people to save or invest and even give them the opportunity to exchange gifts for real money.
Cueli underscored the diversity of “business models,” which also include initiatives that promote financial inclusion, alternative loans and solutions for small businesses.
He said the winning proposals, out of a total of 250 applications, are completely aligned with Visa’s goal to use fintech’s technological innovations and connect them with banks and merchant outlets to spur digital-era payment solutions for consumers.
McCarthy and Cueli were on hand on Thursday in Miami for the presentation of the 10 finalists’ projects during Finnosummit, the leading Latin American conference for fintech start-ups, which was held in that Florida city for the first time.
The Everywhere Initiative competition, launched by Visa in 2015 in the United States, is being held this year in North America, Europe, the Middle East, Africa, Asia and Latin America, where in 2017 nearly a dozen countries participated.
McCarthy reiterated that Visa, which had commercial transactions valued at $130 billion last year, is not interested in competing with the large technology companies but rather partnering with them on a range of platforms, including facial recognition, which is already in use in the market.
“We didn’t build the iPhone. We didn’t write the software. But we worked in collaboration with Apple” in a search for more secure payment mechanisms, he said. “And now I can make a payment by looking at my phone.”