Visa Issues 10 Billionth Token, Generating $40 Billion in Incremental E-commerce Globally

Rhea-AI Summary

Visa has issued its 10 billionth token, generating over $40 billion in incremental e-commerce revenue globally. Tokenized payments have saved $650 million in fraud over the past year. Visa’s tokenization technology, launched in 2014, has successfully integrated across 29% of all transactions processed by Visa. Tokenization enhances security by replacing sensitive data with cryptographic keys, reducing fraud by up to 60% and improving payment approval rates globally. This milestone was announced at Money20/20 in Amsterdam, highlighting Visa’s commitment to secure digital payments and future innovations powered by AI.

Positive

• Issued 10 billionth token, generating $40 billion in incremental e-commerce revenue.
• Tokenized payments saved $650 million in fraud over the past year.
• 29% of all transactions processed by Visa use tokens, indicating widespread adoption.
• Tokenization improved payment approval rates by six basis points globally.
• Tokenization technology can reduce fraud rates by up to 60%.
• Over 8,000 issuers and 200 markets have implemented tokenization globally.
• 1.5 million eCommerce merchants use Visa Tokens daily.
• AI-powered tokens give consumers more control over their data, enhancing user experience.

Negative

• Visa survey reveals less than one-third of consumers globally feel in control of their data.
• Only slightly more than one-third of consumers fully understand how their data is used.

Insights

Financial Analyst

Visa's achievement of issuing 10 billion tokens and generating $40 billion in incremental e-commerce revenue is a significant milestone. This is noteworthy for investors as it indicates the company's technological leadership in the digital payments space. The reported $650 million savings in fraud prevention over the past year also highlights the tangible financial benefits of tokenization.

From a financial perspective, this shows Visa's effective use of innovation to address security concerns, which is critical for maintaining and expanding its user base. The 29% transaction processing rate using tokens demonstrates growing consumer and merchant trust. Such advancements could lead to further increases in transaction volumes and a reduction in fraud-related costs, ultimately driving higher profitability.

Additionally, the improvement in payment approval rates by six basis points is a positive sign, as it can lead to higher transaction completion rates and customer satisfaction. Moreover, Visa's position as a leader in tokenization could provide it with a competitive edge in securing partnerships with more issuers and markets globally.

Tech Expert

Visa's implementation of tokenization technology is a fascinating development in the realm of digital payments. Tokenization replaces sensitive data with a cryptographic key, making it virtually useless to scammers and enhancing payment security significantly. For the tech community, the issuance of over 10 billion tokens and the resulting $40 billion in additional e-commerce revenue underscores the technology's scalability and effectiveness.

The technology's capability to reduce fraud by up to 60% aligns with industry trends focusing on cybersecurity. Additionally, embedding tokenization into various devices enhances the convenience and security of digital payments. The widespread adoption among 29% of all Visa transactions indicates a strong market acceptance of this technology.

Looking ahead, the integration of AI to offer consumers more control over their data represents the next frontier in digital payments. This could usher in a new era of personalized, secure payment experiences. AI-powered tokenization could revolutionize how data is managed and shared, marking a significant step forward in consumer data protection and digital convenience.

Market Research Analyst

The announcement of Visa's tokenization milestone is a landmark moment for the payments industry. For market analysts, the ability of tokenization to generate $40 billion in incremental e-commerce revenue and save $650 million in fraud emphasizes its market impact. This achievement showcases Visa's role in driving secure digital transactions and reflects broader trends towards secure, seamless online shopping experiences.

The data indicating that less than one-third of consumers globally feel in control of their data presents an opportunity. Visa's token technology could bridge this gap, enabling more transparent and controlled data usage. This feature is particularly relevant as consumers demand more privacy and security in their online transactions.

Furthermore, the tokenization's impact on payment approval rates and fraud reduction positions Visa as a trusted partner for merchants and issuers. The company's ability to adapt and scale its technology could cement its position as a leader in the evolving digital payments market, fostering confidence among investors.

• Tokenized payments have saved $650 million in fraud in the last year.
• Recently unveiled Visa data tokens will give consumers more control over their data and deliver seamless AI-powered shopping experiences.

SAN FRANCISCO--(BUSINESS WIRE)-- Visa today announced a significant milestone achieved by its tokenization technology, revealing that Visa tokens have generated more than $40 billion¹ in incremental ecommerce revenue for businesses globally and saved $650 million² in fraud in the last year. Visa also announced it has issued more than 10 billion tokens since the technology’s launch in 2014.

Over the last 10 years, Visa has further enhanced security across the payment ecosystem through tokenization – a technology that replaces sensitive personal data with a cryptographic key that conceals sensitive payment data. Tokenization can be embedded into any device, making digital payments more secure while being virtually useless to scammers.

Currently, 29% of all transactions processed by Visa use tokens³, reflecting their widespread adoption and the trust consumers place in this secure payment method.

Tokenization technology has also caused a six-basis point increase in payment approval rates globally. Overall, tokenization can reduce the rate of fraud by up to 60%, providing businesses with more successful transactions and offering much-needed peace of mind to consumers and merchants of all sizes⁴.

“Today’s milestone represents the impact that tokenization has had on the entire payments ecosystem since we introduced the technology 10 years ago,” said Jack Forestell, Chief Product Officer at Visa. “Tokens have changed the game – securing online payments and paving the way for more innovations – from tapping to pay on a phone to enabling a future where we have more control over our data in the age of AI.”

Visa, which announced the milestone live onstage at Money20/20 in Amsterdam today, issued its billionth token in 2020. Due in part to the shift to digital during the pandemic, the adoption of tokens accelerated significantly in the last four years. Today, over 8,000 issuers are enabled for tokenization, with over 200 markets empowered with the technology globally. In the last 12 months, over 1.5 million eCommerce merchants transacted with Visa Tokens every day.

The future of tokens: Transforming the consumer experience

A recent Visa survey revealed that less than one third of consumers globally feel in control of their data⁵, and only slightly more than one third fully understand how their data is used. However, tokenization can unlock a whole new era of personalization and security—one where consumers control their data and approve when and where it can be shared for a more personalized experience.

In the not-too-distant future, Visa data tokens could help merchants and commerce platforms use your data in a way that is both transparent and gives you control—meaning you decide who gets access to your data (and when they no longer do) as well as how your data will be used. Powered by AI, Visa data tokens let consumers view, consent to and revoke data sharing access, right from their banking app.

“Over the last 10 years, Visa has invested in scaling its token infrastructure to power safer and more convenient digital commerce for consumers and merchants here in Europe, and in nearly every market across the world,” said Mehret Habteab, Senior Vice President of Product and Solutions at Visa Europe, who announced the news today in Amsterdam. “As AI begins to create more personalized experiences online, we’re using our token expertise to give people more control over their payments data.”

About Visa

Visa (NYSE: V) is a world leader in digital payments, facilitating transactions between consumers, merchants, financial institutions and government entities across more than 200 countries and territories. Our mission is to connect the world through the most innovative, convenient, reliable and secure payments network, enabling individuals, businesses and economies to thrive. We believe that economies that include everyone everywhere, uplift everyone everywhere and see access as foundational to the future of money movement. Learn more at Visa.com.

¹ VisaNet CY2023 credit and debit global card-not-present (CNP) payment volume for tokenized and non-tokenized credentials
² Risk Datamart CY2023, Visa Processed global card-not-present (CNP) payment volume for tokenized vs non-tokenized credentials.
³ Visanet, Visa processed transactions as of April 2024
⁴ Visanet, Visa processed transactions as of April 2024
⁵ Visa Consumer Empowerment Research, 2023

View source version on businesswire.com: https://www.businesswire.com/news/home/20240604543361/en/

Meg Omecene

momecene@visa.com

Source: Visa Inc.

FAQ

How much incremental e-commerce revenue has Visa's tokenization technology generated?

Visa's tokenization technology has generated over $40 billion in incremental e-commerce revenue globally.

How much fraud have tokenized payments saved in the last year?

Tokenized payments have saved $650 million in fraud over the past year.

What percentage of all transactions processed by Visa use tokens?

Currently, 29% of all transactions processed by Visa use tokens.

When did Visa launch its tokenization technology?

Visa launched its tokenization technology in 2014.

How many issuers and markets have implemented Visa's tokenization globally?

Over 8,000 issuers and 200 markets have implemented Visa's tokenization globally.

What improvements have tokenization brought to payment approval rates?

Tokenization has improved payment approval rates by six basis points globally.

How does tokenization impact fraud rates?

Tokenization can reduce fraud rates by up to 60%.

What was a major announcement made by Visa at Money20/20 in Amsterdam?

Visa announced the issuance of its 10 billionth token and highlighted the benefits of tokenization technology.