Visa Surpasses Contactless Merchant Milestone: Partnerships with Major Merchants Driving Migration to Contactless Payments
National Brands from McDonald’s to CVS/pharmacy Accepting Visa Contactless Cards, Creating One of the Fastest Adoptions of Payment Technology Ever
SAN FRANCISCO, February 2, 2006–Visa today announced it has reached a significant milestone in the acceptance of Visa Contactless by surpassing 20,000 Visa Contactless acceptance locations in the United States. Consumers can make contactless payments at some of the best-known brands in America, including McDonald’s, AMC Theatres®, CVS/pharmacy and Meijer.
Significant consumer and merchant demand for contactless payments has made the Visa Contactless platform one of the most rapidly adopted payment innovations in Visa history. To date 4 million Visa-branded contactless payment cards have been issued worldwide – underscoring the continued migration away from cash.
Visa Contactless provides increased speed and convenience at the point-of-sale, making the technology ideal for high-volume, small ticket merchants and their customers. Visa Contactless is one of a number of innovative solutions from Visa, its member financial institutions, and partner merchants that help consumers make their purchases, from food to fuel, more quickly and easily. In addition to Visa Contactless, Visa is helping to drive acceptance and usage of Visa payment cards for small ticket transactions by eliminating the signature requirement on purchases less than $25 in 17 merchant segments. Additionally, Visa is collaborating with terminal manufacturers, merchants, and municipalities to develop solutions for a range of unattended payment terminals where consumers want to use their Visa cards.
“There has been strong momentum for Visa Contactless and small ticket solutions from Visa this year because making the purchase process faster and easier benefits the entire payment chain – members, merchants, and cardholders,” said Elizabeth Buse, Executive Vice President for Visa USA. “This momentum will continue in 2006 and beyond. The cash payment market opportunity is $1.2 trillion, and contactless will help drive the migration from cash to electronic payments.”
Visa member financial institutions have addressed the demand for contactless around the world. Visa’s global experience with contactless payments, which began in 2002, has helped drive the U.S. deployment of Visa Contactless. For example, in Malaysia more than 500,000 contactless smart cards are being issued – the world’s first commercial implementation of contactless based on EMV smart card standards.
In the U.S., millions of Visa cards were issued in 2005 with the new contactless feature. Chase has led the way with contactless payments through its launch of over six million Chase cards with “blink.” Chase cards with blink were issued in key markets such as Atlanta, Dallas/Fort Worth, Denver, New York, Orlando and Philadelphia, launching the first wide-scale geographic deployment of contactless credit cards. Chase cards with blink can be used everywhere consumers use credit cards now, and blink can also be securely used where contactless payments are accepted including merchant locations where speed and convenience are essential.
More issuers are expected to take advantage of Visa’s flexible contactless payments platform in 2006 to launch their own contactless programs.
Merchants continue to adopt the new payment technology at an unprecedented pace. Visa’s research indicates that contactless payments have proven to provide faster transaction times, increased ticket size, greater customer loyalty and reduced cash handling–all benefits that translate into increased revenue and reduced operating costs. In addition, transactions are up to 25 percent faster than cash transactions, and in some of the core merchant categories with primarily small tickets and high cash volumes, Visa Contactless transactions are 25 – 50 percent higher than cash transactions.
In the U.S., the number of Visa Contactless acceptance locations is expected to continue to grow significantly as more national merchants in the quick service, convenience store, movie theater and gasoline industries are deploying contactless terminals.
“At McDonald’s, we are always looking for ways to better serve our valued customers and improve restaurant operations by offering new conveniences including contactless payments,” said Gina Pfeifer, vice president, Business Integration, McDonald’s USA. “The demand for payment options is increasing, and by making Visa Contactless payments available at McDonald’s, we are further demonstrating our relevance to our customers, meeting their changing needs and providing them with convenient payment options that are faster than cash.”
Strong merchant interest has helped drive consumer adoption of Visa Contactless. Throughout Visa’s global trials and deployment, cardholders easily grasp the concept of contactless payments, and they cite the unparalleled speed and convenience at the point of sale as key advantages. Because contactless transactions are an average of 25 percent faster than using cash, consumers are able to spend less time in line, creating an enhanced customer experience.
“Anytime you’re talking about shaving seconds off a purchase, either through contactless payments or no signature for transactions under $25, it helps to fulfill our mission to be the easiest pharmacy for customers to use,” said Josh Flum, Director of Store Technology at CVS/pharmacy.
Innovation remains a key priority for Visa as it looks for opportunities to optimize contactless technology for all stakeholders. Visa International in November announced the expansion of the Visa Smart Breakthrough program to include a new contactless chip solution. The program makes cards, terminals and personalization solutions more cost-effective for financial institutions, merchants and consumers.
On the front-end, Visa designed its contactless platform to have the flexibility to apply to a broad range of Visa products–including credit, debit, and prepaid–and non-traditional forms of payment–such as mini card, key fob, mobile phone and other handheld devices. Visa has already begun testing contactless payments on alternative devices, including a pilot in Atlanta’s Philips Arena to test contactless payments on mobile phones.
“As the number of issuers and merchants participating in Visa Contactless grows, consumers will want to explore contactless payment applications on a range of devices, from mini cards to mobile phones, that match their specific interests and lifestyle,” Buse said. “Visa recognized early on the potential for contactless to drive emerging forms of payment. Our global experience puts Visa in a strong position to deliver contactless payments through alternative devices.”
About Visa USA
Visa USA is the nation’s leading payment brand and largest payment system, enabling banks to provide their consumers and business customers with a wide variety of payment alternatives tailored to meet their evolving needs. Visa USA is committed to increasing the choice, convenience, acceptance, and security of Visa payments for all stakeholders in the payment system – Members, cardholders and merchants. Through its 13,420 Member financial institutions, more than 488 million Visa-branded cards have been issued to cardholders in the United States. Last year, U.S.-based financial institutions relied on Visa’s processing system, VisaNet, to facilitate $1.3 trillion in transactions with unparalleled reliability.
Worldwide, cardholders in over 150 countries carry more than 1 billion Visa-branded cards, accounting for more than $3 trillion in annual transaction volume.
Visa offers a trusted, reliable and convenient way to access and mobilize financial resources – anytime, anywhere, anyway.