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Visa, Mastercard see cross-border uplift in Q2 22

Visa and Mastercard have announced their latest earnings – calendar Q2 22, which is Q2 22 for Mastercard and Q3 22 for Visa – with both enjoying ongoing growth in cross-border volumes as travel restrictions continue to lift.

Visa and Mastercard quarterly cross-border volume growth, 2019-2022, showing increases in the latest quarter

Visa Q3 2022 earnings

  • Travel-related cross-border volumes surpassed 2019 levels for the first time since the pandemic, rising from 82% of 2019 in Q2 to 104% in Q3 2022 as Visa continued to see strong recovery in consumer and commercial travel. This was helped by the reopening of Asia; strong inbound US corridor growth and strong growth in and out of Europe during the peak summer travel season. LatAm has also had “surprising” numbers.
  • Visa is bolstering its cross-border partnerships through Visa Direct – Western Union has enabled Visa Direct for US customers allowing them to send money to select countries globally, while Remitly is offering Visa Direct cross-border payments from Canada to bank accounts globally. 2021 acquisition Currencycloud has also signed more than 100 fintech clients since December.
  • While Visa acknowledged the prospect of an economic downturn, the company did not anticipate a significant hit, with CEO Al Kelly saying that “people are changing what they are buying, not how they’re paying”. He also said the company was stronger in debit, everyday spend and ecommerce than during the 2008 recession, putting it in a strong position to withstand any impact.

Mastercard Q2 2022 earnings

  • Mastercard saw net revenue of $5.5bn in Q2, a YoY increase of 21% (or 27% on a currency-neutral basis). This increase was driven by domestic and cross-border transaction and volume growth, as well as new services and acquisitions.
  • Cross-border volume was up 58% globally for the quarter, reflecting continued improvements in travel-related cross-border (reaching 118% of 2019 levels). Cross-border travel has improved more quickly than expected as border restrictions ease and consumers increase their spending toward travel. There is also more room to grow, with Asia, which represented 14% of cross-border inbound travel in 2019, currently only at 6% of 2019 levels.
  • Despite supply chain constraints, geopolitical tensions and inflationary pressure, Mastercard is still seeing strong consumer spending (particularly travel-related). It also reported an update on merchant acceptance, which is now at 90 million locations worldwide, more than double the number five years ago.
  • On the economic downturn, CEO Michael Miebach said Mastercard is much more resilient to potential changes in consumer spending than it was during the previous recession. In particular, he highlighted that the company is more diversified across card-based spending – from push payments into general payments for goods and services.

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