Visa and Mastercard FX decline slows down

Visa and Mastercard FX decline slows down

The two big card networks reported their quarterly results yesterday. Top line revenue remains down quarter on quarter, 14% and 17% for Mastercard and Visa respectively. 

Cross-border volumes did start to show some signs of recovery in the quarter though, with volumes contracting at a slower pace. 

What’s supporting the recovery and what is still holding it back

Positive cross-border factors:

  • Travel within the EU during the quarter was up, driven by the summer holiday period and an easing of the lockdowns
  • Card not present transactions, continue to hold up well and ecommerce growth remains strong, over 20% up year on year
  • An expectation that personal travel will recover faster than business travel, with personal being the bigger driver of revenues

Constraining cross-border factors:

  • Travel outside the EU is still anemic 
  • Yields are lower within the EU than outside the EU holding back revenue growth (our data uncovers this pricing)
  • A return to more lockdowns through the winter

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