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Strategy:
Visa’s company strategy is to accelerate revenue growth in consumer payments, increase new flows and value-added services, and fortify the key foundations of their business model. They want to invest and grow in card-based payments, extend services for non-card cross border payments, and further digitalized accounts payable and accounts receivable processes.
Visa’s strategies do differentiate from some of its key competitors. Since all of their competitors use different transaction processes, their goals and strategies differ. For example, PayPal’s strategy is to grow core business, expand its value proposition for merchants and consumers, form its strategic partnerships, and seek new areas of growth. Some of their other goals in 2021 were to improve PayPal and Venmo digital wallets and to enhance their online and in person shopping abilities. Jack Henry’s strategy includes providing commercial banks and credit unions with core operating systems, cross selling complimentary products and services to enhance functionality, bettering customer service, and capitalizing companies acquisition strategy.
Although many of these companies have different strategies, they all have a goal to improve their digitalized payments. Like stated in "Visa’s Competitive Landscape", Covid-19 has accelerated the need for contactless payments. Visa wants to improve their non-card-based payments while PayPal wants to improve their digital wallet. Given the new projectile of going digital, all companies need to adapt and improve their practices to satisfy their customers needs.
SWOT Analysis:
A SWOT analysis is an appropriate way to evaluate what companies need to work on as well as identifying their success in the industry. Given the chart below, Visa has many strengths and opportunities to keep dominating the industry. However their lawsuit in 2020 while trying to acquire Plaid Inc could lead to a drain of funds and a bad image. Their threats will always be their main competitors, as well as other countries' regulations because they are a global company. Lastly, the change from LIBOR to alternative exchange rates could greatly increase costs for financial intuitions in order to cover the change in risk.
Figure 1: Visa SWOT Analysis
Visa Inc SWOT Analysis.” Visa Inc. SWOT Analysis, Dec. 2021, pp. 1–7. EBSCOhost, search.ebscohost.com/login.aspx? direct=true&db=bth&AN=154605838&site=ehost-live.
ESG Score:
Environmental Sustainability and Corporate Governance is an evaluation of a company’s effect on society and the environment. It is often compiled into one score and compared to an industry average. Visa prioritizes their ESG issues, and has six areas they focus on bettering. They include, investing in their workforce, empowering people, communities, and economies, securing commerce, protecting customers, protecting the planet, and operating responsibility.
Visa's ESG Risk score is 16, which is broken down into 0.7 environmental risk, 7.8 social Risk, and 7.5 governance risk. A score of 16 is evaluated as low risk, with scores ranging from 0-100. Their three main issues are data and privacy issues, business ethics, and human capital. Their score is average for the industry. PayPal has a score of 16 , as well as Jack Henry, Block has a score of 19, Western Union with 14, and Fidelity National Information Services with 18.
Sources:
https://usa.visa.com/dam/VCOM/global/about-visa/documents/visa-2020-esg-report.pdf
Bloomberg, BICO report Jack Henry. Bloomberg Terminal 19, February 2022.
Bloomberg BICO report PAYPAL. Bloomberg Terminal 19, February 2022.
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