New Visa payment features launched in US. What does it mean for customers?

Date: November 26, 2024

New Visa payment features launched in US. What does it mean for customers?

Visa Launches Flexible Payments in the U.S. and UAE

Visa has introduced its “flexible payments” feature in the United States and the United Arab Emirates, aiming to meet the growing demand for versatile and convenient payment solutions. This feature, called “flexible credential,” enables customers to use a single card to access multiple funding sources. It is already available in several Asian markets, including Hong Kong, Japan, the Philippines, Singapore, Thailand, and Vietnam.

Addressing Consumer Demand for Payment Flexibility

With the rapid rise of e-commerce, consumers are prioritizing flexibility and convenience in their financial transactions. A Visa survey found that 51% of cardholders value the ability to access multiple accounts or funding sources through a single credential.

“Most people think of their finances on a month-to-month basis. Breaking down purchase costs can help them make informed financial decisions while allowing retailers to increase sales,” explained Odysseas Papadimitriou, CEO of WalletHub.

U.S. Rollout in Partnership with Affirm

For the U.S. launch, Visa has partnered with Affirm, a leading fintech company with 1.4 million active cardholders. Affirm specializes in providing flexible payment options, including “buy now, pay later” solutions, which have become increasingly popular with consumers looking for greater control over their spending.

Expansion in UAE with Liv Bank

In the UAE, Visa is collaborating with Liv Bank, a prominent digital bank known for its tech-savvy customer base. The partnership aims to cater to a younger, digitally active audience that demands seamless and flexible payment options.

Plans for European Expansion

Mark Nelsen, Visa’s global head of consumer products, revealed plans to expand the “flexible payments” feature to Europe in the coming months. This move aligns with Visa’s strategy to establish a stronger foothold in regions where digital payments are gaining momentum.

Collaboration Between Fintechs and Traditional Players

The partnership with Affirm highlights the growing alliances between fintech firms and traditional financial institutions. While these entities have often been viewed as competitors, collaborations like this demonstrate their potential to unlock new revenue streams.

“It’s easier for fintechs to pioneer these innovations,” said Nelsen. “But as the ecosystem matures, we expect traditional banks to adopt similar features and take advantage of the opportunities they bring.”

Implications for the Payment Industry

Visa’s initiative reflects broader trends in the payment industry:

Consumer-Centric Innovations: Payment processors and financial institutions are increasingly tailoring their services to meet consumer demands for flexibility and convenience.
Fintech and Legacy Partnerships: Collaborations between fintech startups and established players are becoming more common, allowing both to share resources and expand their market reach.
Global Expansion of Payment Solutions: Companies are scaling their innovations across multiple regions, emphasizing the importance of adaptable and scalable financial tools.

Conclusion

Visa’s rollout of the “flexible payments” feature marks a significant step in enhancing customer convenience and meeting the evolving needs of the digital economy. With plans for further global expansion and increased collaboration between fintechs and traditional institutions, Visa is positioning itself as a leader in the future of payment solutions.