Visa 2015 Annual Report Download - page 41

require for similar reasons, the failure could interrupt our services. Because of the centrality of our
processing systems to our business, any interruption or degradation could adversely affect the
perception of our brands’ reliability and harm our business.
We may encounter account data breaches, cyberattacks or system failures involving card or
other data processed, stored or transmitted by third parties or by us.
We, our clients, merchants, and other service providers process, store or transmit account holder
and other information in connection with Visa-branded cards and payment products. In addition, our
clients may use third-party processors to process transactions generated by cards carrying our brands.
The security measures and procedures we, our clients, merchants and other service providers have in
place to protect sensitive account holder data and other information may not be successful or sufficient
to counter all data breaches, cyberattacks or system failures. Defending against even unsuccessful
attempts to access our systems could materially increase our costs.
A failure or breach of the systems processing, storing or transmitting sensitive account holder data
and other information could lead to fraudulent activity involving Visa-branded cards, reputational
damage, claims against us, and loss of clients. If we are sued in any lawsuit in connection with any
data security breach, we could be involved in protracted litigation. If unsuccessful in defending such
lawsuits, we may have to pay damages or change our business practices or pricing structure, any of
which could harm our business. In addition, any reputational damage resulting from an account data
breach, cyberattacks or system failure at one or more of our clients, merchants or other third parties
could decrease the use and acceptance of Visa-branded cards, which could harm our payments
volume, revenues and future growth prospects. Finally, a breach may also subject Visa to additional
regulations or governmental or regulatory investigations, which could result in significant compliance
costs, fines or enforcement actions against the Company or potential restrictions imposed by
regulators on our ability to process transactions.
Fraudulent or other illegal activity involving Visa-branded cards or payment products could
harm our business.
Criminals are using increasingly sophisticated methods to capture account holder and other
information. They use this information to conduct fraudulent transactions involving our payment
products. Outsourcing and specialization of functions within the payments system are increasing. As a
result, more third parties are involved in processing transactions using Visa-branded cards or payment
products. A rise in fraud levels and other illegal activities involving Visa-branded cards or payment
products could lead to reputational damage to our brands. This could reduce the use and acceptance
of Visa-branded cards and payment products, or lead to greater regulation, which could increase our
compliance costs, lower our payments volume and harm our overall business.
Failure to maintain interoperability with Visa Europe’s systems could damage the business and
global perception of the Visa brands.
Until our proposed acquisition of Visa Europe closes and for a period of time afterwards while Visa
Europe’s systems are being integrated with Visa’s systems, Visa and Visa Europe will continue to
maintain mostly separate authorization, clearing and settlement systems. As a result, we have to
ensure that the two systems can process every transaction involving both of our territories, regardless
of where it originates. Visa Europe’s independent system operations could present challenges to our
business due to increasing costs and difficulty in maintaining the interoperability of our respective
systems. Any inconsistency in the payment processing services and products between Visa Europe
and us could negatively affect account holders from Visa Europe using payment products in the
countries we serve or our account holders using payment products in Visa Europe’s region. Failure to
authorize, clear and settle inter-territory transactions quickly and accurately could harm our business
and impair the global perception of our brands.
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