€1 in every €7 spent in Europe on a Visa card – over 50% of all Visa transactions in Europe will be on a mobile device by 2020

18 January – Visa Europe processed nearly one billion transactions every month in 2011 totaling €1.16 trillion. Fraud losses on Visa cards in Europe reached an all time low in 2011, with the fraud to sales ratio falling by 27% to 0.038%, meaning that fraud now accounts for less than four cents in every €100 spent.

Spend on Visa cards in Europe grew 14% in 2011, totaling €1.16 trillion, according to results released by Visa Europe.  This growth now means that €1 in every €7 of consumer spending in Europe is on a Visa card, up from €1 in €8 in 2010 and €1 in €18 in 2000. The growth in debit, as the preferred payment card for Europeans, continued apace, registering 16% year-on-year growth in both value and volume of transactions made at point of sale. Nearly 80% of Visa spend is on debit cards in Europe.

Peter Ayliffe, Chief Executive, Visa Europe said: ”Despite the continuing economic challenges, spending on Visa cards by Europeans grew by 14% in 2011 as more consumers and retailers recognised the convenience, security and efficiency of electronic payments.  The strongest growth, once again, was on debit cards. We expect this growth in electronic payments to continue during 2012 when we will be launching mobile payments and our digital wallet services.  These new services, that are a key part of our future of payments strategy, will revolutionise consumers’ everyday shopping experience to the extent that by 2020 we predict that over half of all Visa transactions in Europe will be on a mobile device.’

Visa Europe processed nearly one billion transactions every month in 2011, registering a 19% year-on-year growth as the number of processed transactions reached 11.8 billion.  This growth in Visa Europe’s processing services has prompted investment in a new data centre, to be located in UK, which is twice the size of the current primary processing centre.  This expanded operation will support anticipated future increases in processing, including growth in ecommerce transactions and mobile payments.

Fraud losses on Visa cards in Europe reached an all time low in 2011, with the fraud to sales ratio falling by 27% to 0.038%, meaning that fraud now accounts for less than four cents in every €100 spent. Much of this downward trend in the face-to-face environment can be attributed to the success of EMV chip technology, with more than 75% of all Visa cards in Europe now chip-enabled.  The increased uptake of Verified by Visa by card issuers and merchants, together with real time risk scoring introduced into Visa Europe’s processing capability, are contributing to the reduction in e-commerce fraud.

Future of Payments

Significant progress was made in payments innovation by Visa Europe in 2011 with a total of 30 million contactless cards issued – out of which 20 million only in UK – and the first mobile payment services launched, with person-to-person payments and text alerts in October 2011.  Strategic investments were also made by Visa Europe in Monitise and Beyond Analysis¹ to assist in its delivery of its Future of Payments strategy

In 2012 Visa Europe expects to see contactless cards hit 50 million in circulation in Europe – 30 million only in the UK market – and the first launches of mobile phones enabled to make point-of-sale transactions.  Visa Europe will also launch its new ecommerce digital wallet service in the latter half of the year.

Consumers will get a unique opportunity to experience the future of payments for themselves at the London 2012 Olympic and Paralympic Games where Visa will showcase its payment innovations to a worldwide audience. For the first time, consumers will not need to use cash at the Games unless they choose to do so.

Financials

Visa Europe, operating as a low cost, not for profit membership association, for the first time ever reported total revenues for the year of more than €1 billion.  Following major investments to ensure delivery of Visa Europe’s ‘Future of Payments’, this produced a pre-tax surplus of €241 million.  This sum was retained within the business to support capital and reserves which rose to €738 million.

UK market

For the first time, £1 in every £3 spent in the UK is now spent on a Visa card, fuelled by growth in debit and ecommerce spend.  Ecommerce spending accounted for 22% of all Visa spend in the UK, growing by more than 40% over the year. In the year ending 30^th September 2011, debit spend on Visa cards topped £318 billion, a rise of 27% on the previous year.

Peter Ayliffe, Chief Executive, Visa Europe said: “In 2010, debit overtook cash for the first time and consumers’ appetite for using debit continued unabated in 2011, with spending on Visa debit cards up 27% and accounting for 90% of all Visa consumer card spend.  Consumers’ preference for debit cards signals just how fundamentally important electronic payments are to the UK’s retail banking sector and the wider economy.

“We expect this growth in electronic payments to continue during 2012 when we will be launching mobile payments and our digital wallet services.  These new products, that are a key part of our Future of Payments strategy, will revolutionise consumers’ everyday shopping experience to the extent that by 2020 we predict that over half of all Visa transactions will be on a mobile device”.

Fraud losses on Visa cards in the UK reached an all-time low in 2011, with the fraud to sales ratio falling by 23% to 0.05%. Much of this downward trend in the face-to-face environment can be attributed to the success of Chip and PIN (EMV) technology; 2011 marked five years since the full transfer to chip technology in the UK.  The increased uptake of Verified by Visa by card issuers and merchants, together with real time risk scoring introduced into Visa Europe’s processing capability, are contributing to the reduction in ecommerce fraud.