(V) Visa Eyes Canadian Expansion

In a concerted effort to tap the growing debit card market in Canada, Visa Inc. (V) joins with Air Canada to facilitate its Canadian customers with Visa debit cards with which to purchase Air Canada tickets. The agreement has already come into effect from the beginning of this month, and Canadian customers have already started benefiting from the alliance of the two entities.

Visa’s Canadian customers can buy tickets by paying online using their Visa Debit card for scheduled passenger services from the website of Air Canada. They also have the option of doing the same via Air Canada Reservations from their mobile phones.

Visa’s debit cards enable customers to transfer funds using the electronic medium even without logging in to their respective bank accounts. It is expected that this “one-step” e-payment facility will attract a large number of Canadian customers, thereby enhancing debit functionality within the online space.

With increasing number of consumers together with large number of transactions Visa tries to mitigate the risk of fraud by leveraging its payment technology. The technology safeguards the cardholder’s interest against all kind of deception if the card is stolen or lost. Visa’s Zero Liability Policy ensures the prevention of any kind of online fraud.

Visa has increasingly invested in the emerging market, leveraging its technological strength. All this is in sync with the company’s strategy of driving growth through increased payment volumes along with consistent growth in processed transactions. The company aims to retain its strength by exploring newer growth avenues.

Visa’s competitors MasterCard Inc. (MA) and American Express Co. (AXP) are equally expanding their market coverage to seek greener pastures through newer initiatives. With MasterCard’s recent launch of PayPass Wallet Services and AmEx collaborating with Isis Mobile, to ensure a secure shopping experience, the card industry is set to witness stiff competition.

We retain our long-term Neutral recommendation on Visa. The company currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.

AMER EXPRESS CO (AXP): Free Stock Analysis Report

MASTERCARD INC (MA): Free Stock Analysis Report

VISA INC-A (V): Free Stock Analysis Report


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