Visa 2008 Annual Report Download - page 7

Table of Contents
Industry Overview
The Global Payments Industry
We operate in the global payments industry, which is undergoing a major shift from paper-based payments, such as cash and checks, to card-based and
other electronic payments. For more than 30 years, Visa has played a central role in driving this migration by providing payment products and services that we
believe deliver significant benefits to consumers, businesses, governments and merchants. We believe that consumers are increasingly attracted to the
convenience, security, enhanced services and rewards associated with electronic payment forms. We also believe that corporations and governments are
shifting to electronic payments to improve efficiency, control and security, and that a growing number of merchants are accepting electronic payments to
improve sales and customer convenience.
The global payments industry consists of all forms of payment and value transfer, including:
• paper-based payments—cash, personal checks, money orders, government checks, travelers cheques, official checks and other paper-based means
of transferring value;
• card-based payments—credit cards, charge cards, debit cards, deferred debit cards, ATM cards, prepaid cards, private label cards and other types
of general-purpose and limited-use cards; and
• other electronic payments—wire transfers, electronic benefits transfers, automated clearing house payments and other forms of electronic
payment not typically tied to a payment card or similar access device.
We believe that the shift to electronic payment forms is a worldwide phenomenon; however, in many developing countries, it is at an early stage and
will be accelerated by globalization of commerce and increased travel. Recent innovations such as contactless cards and mobile payments are also increasing
the attractiveness of electronic payments. We believe these trends create a substantial growth opportunity for the global payments industry.
The most common card-based forms of payment are general-purpose cards, which are payment cards that permit widespread usage. General purpose
cards are typically categorized as:
• "pay now" cards, such as debit cards, which enable the cardholder to purchase goods and services by an automatic debit to a checking, demand
deposit or other current account;
• "pay later" cards, which typically permit a cardholder to carry a balance in a revolving credit account (a credit card or deferred debit card) or
require payment of the full balance within a specified period (a charge card); and
• "pay before" cards, such as prepaid cards, which are prefunded up to a certain monetary value.
The primary global general purpose card brands include Visa, MasterCard, American Express, Discover, JCB and Diners Club. While these brands—
including Visa—were historically associated primarily with credit or charge cards in the United States and other major international markets, Visa and others
have over time broadened their offerings to include debit, ATM, prepaid and commercial cards.
In addition to general purpose cards, a number of retailers and other entities issue limited-purpose credit, charge and prepaid cards that can be used for
payment only at the issuing entity. These cards are generally referred to as private label cards. Private label cards are sometimes issued by a financial
institution under a contractual agreement with the retailer.
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