Visa and Mastercard results: Recovery begins
We’ve entered earnings season with a host of year-end reporting, some of which – most notably Western Union and Ria – we’ll be covering next week. This week, we start by focusing on Visa and Mastercard.
![](http://cdn.fxcintel.com/fxcintel/wp-content/uploads/visa-mastercard.webp)
For both companies, the story is similar. Overall net revenue is down, primarily due to the reduction in cross-border business, although both Visa and Mastercard are showing signs of recovery compared to the previous two quarters. Cross-border ecommerce has also been strong for both.
Visa
- For Visa’s Q1 2021 (which is calendar Q4 2020), international transactions revenue accounted for 25% of Visa’s net revenue, compared to 33% a year ago.
- Visa highlighted cross-border P2P and remittances as a key area for future growth, with TransferWise, Western Union, Remitly and MoneyGram all onboarded in 2020.
- Other partnerships include African fintech Zeepay, which will use Visa Direct for its money transfer services, and Goldman Sachs, which is using Visa B2B Connect for its cross-border money movement.
- Visa also plans to enable customers to purchase and sell cryptocurrencies through partnerships with wallets and exchanges, with the company seeing this as a strong area of future growth.
Mastercard
- For Q4 2020, cross-border volume fees accounted for 21% of net revenue, compared to 33% a year ago.
- Digital payments, including cross-border ecommerce, is and will continue to be a strong focus for Mastercard.
- The company has seen a slowing in cross-border travel, particularly in Europe, due to the return of lockdowns in many countries, however it has positioned itself for the return of travel with “strong travel-related portfolios”, which it believes will be a key driver of growth once countries begin to ease lockdown restrictions.
- However, it is not yet giving a forward view on net revenues for 2021, as it considers the vaccine rollout to be too uncertain at present.