The news: The two largest US card networks reported slower payments volume growth in Q3 than the same period a year ago, when the post-lockdown spending boom turbocharged volume gains.
How we got here: The geopolitical and macroeconomic headwinds buffeting Mastercard and Visa, including Russia’s war on Ukraine and the uneven global COVID-19 recovery, carried into Q3.
Aside from inflation—which increases nominal payments volume—here are other factors that may have helped buoy Visa’s and Mastercard’s results:
What’s next? Both Visa and Mastercard said they’ll keep monitoring how economic conditions develop and update their strategies if needed.
Visa sees growth opportunities for 2023 in three key areas: consumer payments, new payment flows, and value-added services. As cash use declines globally, investing in these areas can help Visa sustain revenue growth. The share of point-of-sale payments made with cash is expected to decrease 44% between 2021 and 2025, according to FIS.
Mastercard laid out similar plans: It wants to establish deeper relationships with customers by encouraging them to use both its card services and its open banking innovations—which Mastercard CEO Michael Miebach said were a “tremendous opportunity” during the firm’s earnings call.
This article originally appeared in Insider Intelligence's Payments Innovation Briefing—a daily recap of top stories reshaping the payments industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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