The Visa CEO disregarded cryptocurrency as a possible threat to their market dominance as a payment provider. Alfred R Kelly declared this in an interview with Jim Cramer, the host of CNBC’s Mad Money from the floor of the NYSE. Visa has finished the year 26% up from last years stock price and has posted record results even if the last days bear run made them lost 6%.
Visa’s Great Results
Visa, one of the biggest companies in the area of payment processing and credit cards, has posted record earnings despite the latest bear run that brought the stock market down recently. Alfred Kelly summarized the great results that the company has managed to sustain in a good year for the world economy.
Visa is the second payment provider at a worldwide level, just behind the Asian monster UnionPay, a market that has been tough for them to crack, according to their CEO. According to Kelly, they have managed to get their numbers up double digits since the last year, except for Europe that came close with 9.6%.
Apart from this, Visa stance in China is still pretty good despite not being there and just getting fees from international transactions made from Chinese credit cards through third-party banks.
Visa CEO Disregarded Cryptocurrency
But the inevitable question had to be asked, and Cramer certainly did it. Jim asked about the danger that cryptocurrencies could project over Visa’s business model, and Visa CEO disregarded cryptocurrency as a valid contender for their presence, at least in the short or medium term.
Alfred Kelly declared that: “For us to jump into cryptocurrencies there should be a fiat like market. Cryptocurrencies are used and seen more like a commodity than a currency today”. But he also declared in favor of entering the cryptocurrency payment market when it reaches a big enough user base: “If the market goes there, we will be there; Visa wants to be in the middle of every payment market”.
About the next great challenge, he mentioned the classic plastic vs cash war, and how they are approaching a cashless society in certain places. But also recognized that cash is the biggest and preferred payment method for billions of people in the actual world, and that lack of banking affiliation can hurt their goals in the long run.
Visa And Cryptocurrencies:
Visa has had a hostile stance against cryptocurrencies, blocking some payments processors and exchanges from processing cryptocurrency purchases with their cards. Also, they have reclassified this kind of purchases as cash advances to collect a higher fee.
But they have also leveraged blockchain as a necessary technology for some of their operations, even partnering with IBM to create a blockchain based B2B payment settling system called B2B Connect.