Visa Enters Square Board
- Visa is now part of Square’s board through capital investment. The young company sells a white square magnetic stripe reader enabling iOS terminals (iPhone, iPod Touch, iPad) to process bank card payments. It announced its engineering teams would soon be doubled.
- Square was created end 2009 by Twitter’s founder; its concept is now validated by the world largest card scheme. Visa’s popularity should help American merchants who do not accept card payments (or about 27 million merchants) adopt Square’s device.
- In parallel, Visa issued best practices on mobile payment security intended for both developers and merchants.
- Like American Express with PayFone (see above), other large card schemes now invest in innovating non banking players. Bank service providers thus intend to build up specially crafted expertise centres and try to avoid missing markets that have been partly pre-empted by the former generation of new entrants, such as PayPal.
- American giants were urged to search for new business models as acquisition margins threaten to decrease, due to Durbin Amendment’s implementation on debit card MSCs. This quest also accounts for the increasing number of EMV cards issuing programs (See Fraud Prevention section).
- During its member banks conference on 8 April in Barcelona, Visa Europe also announced it would invest 100 million euros annually in mobile payment and e-commerce technologies. This involvement will be enhanced before end of the year through mobile payment commercial launches “followed by a major launch in e-commerce payments”, designed to make these payments more convenient and secure. The replacement of both cheques and cash is again sought through the convergence of plastic card-based payments with mobile and e-commerce. In Q1 2011, Visa Europe witnessed an 11% increase in its volumes on an unchanged number of cards basis, compared to Q1 2010.
See November 2010 Watch