STRATEGIC PARTNERS
March 12, 2000
FOSTER CITY, Calif. -- Visa U.S.A., the nation's largest payment card system, announced that it processed $721.1 billion in consumer and business purchases in 1999, up 18 percent from $611 billion in 1998. Visa attributed the growth to a booming economy and the popularity of debit and credit cards among consumers and businesses. According to Visa, card use is now at an all-time high. Today, 26 cents of every $1 in U.S. discretionary consumer spending is on plastic, with about half of that on Visa, according to a Visa payments panel study. Plastic is "just an easier and safer way to pay," said Visa U.S.A. President and CEO Carl F. Pascarella. "We are forecasting that Visa alone will surpass $1 trillion in physical and e-commerce transactions in the U.S. within two years." Growth in Visa's 1999 dollar volume was driven by the Visa check card, a debit card that now accounts for more than a quarter of Visa's total dollar volume. Dollar volume on the check card reached $183.8 billion in 1999, up 36 percent from 1998. Non-traditional acceptance categories also drove Visa's growth. Visa volume at movie theaters, for instance, jumped 107 percent in 1999, as moviegoers spent $195 million with their Visa cards. At fast-food restaurants, where Visa volume rose 66 percent last year, some $616 million was transacted on Visa cards. Similarly, Visa card volume for phone bill payments soared 110 percent last year, while information retrieval and bowling alleys increased 109 percent and 47 percent, respectively. More traditional acceptance categories also had an impact, including recurring utility payments, which saw 22 percent growth, cable/pay TV at 76 percent, variety stores at 98 percent, florists and nurseries at 86 percent, wholesale clubs at 57 percent and day care at 33 percent. Visa said that it processed 40 billion transactions in 1999, the equivalent of some 1,268 transactions per second. The busiest day of the year: Dec. 24, 1999, when transactions topped 3,500 a second. Visa's commercial card products, tailored for large and small businesses, represented a major product growth category last year. Volume on bank-issued Visa commercial cards reached $45 billion in 1999, up 42 percent from 1998. There are now over 9.2 million Visa commercial cards in circulation, up 23 percent from year-end 1998. e-Visa, Visa's Internet unit, estimated that some 2 percent of Visa's 1999 volume -- or $13 billion -- was from transactions over the Internet, based on merchant codes entered into the VisaNet system, Visa's processing network. Often, merchants that operate in both the physical and virtual retail worlds do not categorize their e-commerce transactions as such. As a result, e-Visa's estimates are based on an analysis of VisaNet activity, tracking dedicated e-comm merchants exclusively. e-Visa estimates that some 10 percent of Visa's annual volume will come from Internet-related transactions by 2003. Also contributing to Visa's 1999 performance was a drop in card fraud. Visa fraud levels dipped to 6 cents of every $100 in transactions.
