What changed in this filing

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Item 1. Business

2020-11-19 compared with 2019-11-14 · 244 added, 209 removed, 166 unchanged (73% of the section changed)

Visa is the world’s leader in digital payments.

Visa is one of the world’s leaders in digital payments.

Our mission is to connect the world through the most innovative, reliable and secure payments network — enabling individuals, businesses and economies to thrive.

We facilitate commerce across more than 200 countries and territories among a global set of consumers, merchants, financial institutions, businesses, strategic partners and government entities.

We facilitate digital payments across more than 200 countries and territories among a global set of consumers, merchants, financial institutions, businesses, strategic partners and government entities through innovative technologies.

Since Visa’s inception in 1958, Visa has been in the business of facilitating payments between consumers and businesses.

With new ways to pay, we are evolving into a company that enables money movement for everyone, everywhere.

To accomplish this, we are continually focused on extending, enhancing and investing in our proprietary network, VisaNet, while seeking new ways to offer products and services and become a single connection point for initiating any transaction, both on the Visa network and beyond.

This has enabled Visa to become one of the world’s largest electronic payments networks based on payments volume and number of transactions.

Our fundamental business model is based on the following:

We facilitate secure, reliable and convenient transactions between financial institutions, merchants and account holders.

With new ways to pay, we have evolved into a global company that is a Trusted Engine of Commerce, providing payment solutions for everyone, everywhere.

We are focused on extending, enhancing and investing in our proprietary network, VisaNet, while seeking new ways to offer products and services and become a single connection point for facilitating any payment transaction, both on the Visa network and beyond.

• We facilitate secure, reliable and convenient transactions between financial institutions, merchants and consumers.

We traditionally have referred to this as the “four-party” model.

As the payments ecosystem continues to evolve, we are continuing to broaden this model to include digital banks, wallets and a range of financial technology companies (fintechs), governments and non-governmental organizations.

We provide transaction processing services (primarily authorization, clearing and settlement) to our financial institution and merchant clients through VisaNet, our global processing platform.

As the payments ecosystem continues to evolve, we have broadened this model to include digital banks, wallets and a range of financial technology companies (fintechs), governments and non-governmental organizations.

We provide transaction processing services (primarily authorization, clearing and settlement) to our financial institution and merchant clients through VisaNet.

During fiscal year 2020, we saw 204 billion payments and cash transactions with Visa’s brand, equating to an average of 559 million transactions a day.

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• We offer a wide range of Visa-branded payment products that our 15,400 financial institution clients use to develop and offer core business solutions, including credit, debit, prepaid and cash access programs for individual, business and government account holders.

During fiscal year 2019, Visa’s total payments and cash volume grew to $11.6 trillion and more than 3.4 billion cards were available worldwide to be used at more than 61 million merchant locations.

During fiscal year 2020, Visa’s total payments and cash volume was $11.3 trillion, and 3.5 billion credentials were available worldwide to be used at nearly 70 million merchant locations.

• We take an open, partnership approach and seek to provide value by enabling access to our global network, including offering our technology capabilities through application programming interfaces (APIs).

Additionally, we enter into partnerships with both traditional and emerging players to innovate and expand the payments ecosystem.

This approach helps our partners leverage the resources of our platform to scale and grow their businesses more quickly and effectively.

We are accelerating the migration to digital payments by enabling new types of transactions beyond the core consumer-to-business (C2B) payments.

These include person-to-person (P2P), business-to-consumer (B2C), business-to-business (B2B) and government-to-consumer (G2C) payments.

We provide value-added services to our clients, including consulting and analytics, fraud management and security services, merchant solutions, processing capabilities and digital services like tokenization.

We invest in and promote our brand to the benefit of our clients and partners through advertising, promotional and sponsorship initiatives with FIFA, the International Olympic Committee and the International Paralympic Committee, and the National Football League, among others.

We partner with both traditional and emerging players to innovate and expand the payments ecosystem, allowing them to leverage the resources of our platform to scale and grow their businesses more quickly and effectively.

It also creates a more inclusive ecosystem with products that could reach the under and unbanked populations.

• We are accelerating the migration to digital payments and evolving Visa to be a “network of networks” to enable the movement of money on VisaNet and beyond.

Visa’s network of networks approach creates opportunities by facilitating person-to-person (P2P), business-to-consumer (B2C), business-to-business (B2B), business-to-small business (B2b) and government-to-consumer (G2C) payments.

• We provide value added services to our clients, including issuer and consumer solutions, merchant and acquirer solutions, fraud management and security services, data solutions, and consulting through Visa Consulting & Analytics.

• We invest in and promote our brand to the benefit of our clients and partners through advertising, promotional and sponsorship initiatives with FIFA, the International Olympic Committee, the International Paralympic Committee and the National Football League, among others.

We also use these sponsorship assets to showcase our payment innovations.

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FISCAL YEAR 2020 KEY STATISTICS

(1) Please see Item 7–Management’s Discussion and Analysis of Financial Condition and Results of Operations for a reconciliation of our non-GAAP financial results.

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Revenue Details

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We have one reportable segment, which is Payment Services.

Visa earns revenue by facilitating payments across more than 200 countries and territories among a global set of consumers, merchants, financial institutions, businesses, strategic partners and government entities through innovative technologies.

(1) Figures in the tables may not recalculate exactly due to rounding.

(2) Please see Note 3—Revenues t o our consolidated financial statements included in Item 8.

Financial Statements and Supplementary Data for the impact of the new revenue standard.

Visa earns revenue by facilitating commerce across more than 200 countries and territories among a global set of consumers, merchants, financial institutions, businesses, strategic partners and government entities.

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Visa is not a financial institution.

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We do not earn revenues from, or bear credit risk with respect to, interest or fees paid by account holders on Visa products.

Interchange reimbursement fees represent a transfer of value between the financial institutions participating in our open-loop payments network.

Interchange reimbursement fees represent a transfer of value between the financial institutions participating in our payments network.

We administer the collection and remittance of interchange reimbursement fees through the settlement process, but we generally do not receive any revenue related to interchange reimbursement fees.

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FISCAL YEAR 2020 KEY FOCUS AREAS

As technology evolves from wired to wireless solutions — driven by technology developments such as the expansion of mobile technology and the rise of 5G networks — there are significant opportunities to grow digital payments.

To capture this growth, we are strengthening our core business while simultaneously evolving our organization to seize opportunities to open new payment flows, expand access, build our acceptance footprint and grow our base of partners and clients.

We are also building and acquiring new capabilities that can add value to our clients as we strengthen the foundation of our business:

F iscal year 2020 and COVID-19 have brought unprecedented challenges and widespread economic and social change.

At the same time, the past fiscal year demonstrated the strength and resiliency of our strategy and the meaningful role we play at the center of the payments ecosystem.

It has also accelerated progress, including accelerating the shift to ecommerce and the demand for contactless payments, providing significant opportunities for Visa that are aligned with our strategy.

As we look to be a single point of connection for money movement globally, there are three primary levers to that growth — consumer payments, new flows and value added services.

We are also building and acquiring new capabilities that can add value to our clients and strengthen the foundation of our business:

technology, security, brand and talent.

Core Business

Consumer Payments

For decades, Visa’s growth has been driven by the strength of our core business solutions — credit, debit and prepaid products — as well as our global ATM network.

As the pace of change accelerates each year, helped by the advancement of technology and our focus on the user experience in payments, we see significant opportunity for continued growth.

We are accelerating efforts to move approximately $17 trillion in consumer spending and $15-20 trillion of B2B spending still done in cash and check to cards and digital credentials on the Visa network.

Core Products

Business Solutions:

We offer a portfolio of business payment solutions, including small business, corporate (travel) cards, purchasing cards, virtual cards/digital credentials, non-card cross-border B2B payment options and disbursement accounts, covering most major industry segments around the world.

Business solutions are designed to bring efficiency, controls and automation to small businesses, commercial and government payment processes, ranging from employee travel to fully integrated, invoice-based payables.

Credit cards and digital credentials are issued by financial institutions and used by co-brand partners and fintechs to allow consumers and businesses to access credit to pay for goods and services.

As the pace of change accelerates each year, helped by the advancement of technology and our focus on the user experience in payments for both the face-to-face and ecommerce environments, we see significant opportunity for continued growth.

We are accelerating efforts to move approximately $18 trillion in consumer spending still done in cash and check to cards and digital credentials on the Visa network.

Core Business

Credit cards and digital credentials are issued by Visa’s clients and allow consumers and businesses to access credit to pay for goods and services.

Credit cards are affiliated with programs operated by financial institution clients, co-brand partners, fintechs and affinity partners.

Visa does not extend credit to account holders;

however, we provide card benefits, including technology, authorization, fraud tools and brand support that issuers use to enable their credit products.

We also work with our clients on product design, consumer segmentation and consumer experience design to help our clients deliver products and services that match their consumers’ needs.

Debit cards and digital credentials are issued by financial institutions to allow consumers and small businesses to purchase goods and services using funds held in their bank accounts.

however, we provide technology, authorization services, fraud tools and brand support that issuers use to enable their credit programs.

We also work with our clients on product design, consumer segmentation and consumer experience design to help them deliver products and services that match their customers’ needs.

Debit cards and digital credentials are issued by financial institutions and allow consumers and small businesses to purchase goods and services using funds held in their bank accounts.

Debit cards enable account holders to transact in person, online or via mobile without needing cash or checks and without accessing a line of credit.

Visa provides a strong brand, the network infrastructure (which includes processing, acceptance, product features and support, risk tools and services) and industry expertise to help issuers optimize their debit offerings.

Prepaid products draw from a designated balance funded by individuals, businesses or governments.

Visa provides a strong brand, network infrastructure (which includes processing, acceptance, product features and support, risk tools and services) and industry expertise to help issuers optimize their debit offerings.

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Prepaid cards and digital credentials draw from a designated balance funded by individuals, businesses or governments.

Prepaid cards address many use cases and needs, including general purpose reloadable, payroll, government and corporate disbursements, healthcare, gift and travel.

Prepaid cards also play an important part in financial inclusion, bringing payment solutions to those with limited or no access to traditional banking products.

The Visa/PLUS Global ATM network provides account holders with cash access in more than 200 countries and territories worldwide through issuing and acquiring partnerships with both financial institutions and independent ATM operators.

Contactless payments — or when a consumer taps to pay at checkout with a contactless card or mobile phone — continues to see strong adoption around the world.

In 2019, excluding the United States (“U.S.”), tap to pay had surpassed 50 percent of face-to-face transactions that ran over the Visa network.

This is up from less than 30 percent just two years ago.

There are now more than 50 countries where tapping to pay represents at least a third of all domestic face-to-face transactions processed on our network, up from 35 countries at the end of last fiscal year.

is starting to catch up to this global adoption rate.

In 2019, U.S.

financial institutions began issuing contactless cards to customers nationwide.

There are now more than 100 million Visa contactless cards in the U.S., and we expect that number to grow to 300 million by the end of 2020.

Contactless payments can also open up new payment experiences, such as transit.

Transit continues to be an important use case for introducing consumers to the benefits of tapping to pay.

In 2019, Visa helped launch contactless transit solutions in cities around the world, including Belarus, Edinburgh, Florence, Manchester, Miami, Milan, New York, Rio de Janeiro, Singapore, São Paulo and more — making it easier for people to get around while reducing operating costs for private and public transport operators.

Ecommerce has drastically evolved since the first online purchase was made on the Visa network 25 years ago.

Digital commerce growth is outpacing physical retail growth, and we expect this to continue.

This presents an opportunity to evolve both the security and consumer experience around ecommerce.

As a result, we are helping to transform the digital checkout experience by adding more security and removing friction with the launch of click to pay.

Enabled by the EMV® Secure Remote Commerce Specifications, click to pay simplifies the checkout experience, eliminating the need for a consumer to enter payment details each time they are purchasing digital services or shopping online.

Visa-branded prepaid cards also play an important part in financial inclusion, bringing payment solutions to those with limited or no access to traditional banking products.

The Visa/PLUS Global ATM network provides account holders with cash access, and other banking capabilities, in more than 200 countries and territories worldwide through issuing and acquiring partnerships with both financial institutions and independent ATM operators.

Ecommerce has evolved since the first online purchase was made on the Visa network more than 25 years ago.

In fiscal year 2020, due in part to the COVID-19 pandemic, there was a significant acceleration in the shift away from cash to digital forms of payment.

Ecommerce represents only about 14% of global retail spending, so there is still substantial opportunity for ecommerce growth.

We are helping to transform the digital checkout experience by adding more security and removing friction with the launch of Visa Click to Pay.

Enabled by the EMV® Secure Remote Commerce Specifications, Click to Pay simplifies the checkout experience, eliminating the need for a consumer to enter payment details each time they are paying online.

This means greater consistency and fewer steps at checkout, regardless of one’s payment choice.

In October 2019, click to pay went live with select merchants in the U.S., and we expect full commercial migration of Visa Checkout to happen in early 2020.

Consumers can click to pay with confidence when they see a common checkout button with network logos and a stylized depiction of a fast forward icon .

Consumers can click to pay with Visa with confidence when they see the Click to Pay icon, a stylized depiction of a fast forward icon, where Visa is accepted.

During fiscal year 2020, Click to Pay went live with select merchants and payment processors and platforms in the U.S., and was enabled in new geographies, including Australia, Canada, China, Colombia, Hong Kong, Malaysia, Mexico, New Zealand, Poland, Qatar, Singapore, South Africa, Ukraine, United Arab Emirates and the United Kingdom .

As we seek to improve the user experience in the face-to-face environment, tap to pay, which is tapping a contactless card or mobile device on a terminal to make a payment, has emerged as the preferred way to check out amongst consumers in many markets around the world.

Contactless penetration grew to 43% of all face-to-face transactions around the world in fiscal year 2020.

In addition, Visa has worked with payments industry partners and governments to support raising contactless payments limits in markets around the world that require cardholder verification on tap to pay transactions.

More than 50 markets across Europe, the Middle East, Africa and Canada have taken this step to help more individuals utilize this way to pay in fiscal year 2020.

is one of the most significant opportunities for growth in tap to pay.

Tap to pay awareness and adoption accelerated in the U.S.

this year, and we expect that demand to continue to grow.

More than 70% of face-to-face transactions at checkout in the U.S.

occur at a merchant that has the ability to accept contactless payments, and more than 80 of the top 100 merchants by transactions are enabled for tap to pay.

(1) The SRC payment icon is available for use in connection with implementations of the EMV® Secure Remote Commerce Specification.

The SRC payment icon image files are provided following execution of the EMVCo Trademark License Agreement for SRC Payment Icon and may only be used in conformance with the Secure Remote Commerce (SRC):

Payment Icon Reproduction Requirements.

Growing Access and Acceptance

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A key component of how we expand our business focuses on growing access and increasing acceptance of our products around the world.

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Drive new acceptance categories to uncover additional growth .

We continue to expand our acceptance footprint in both mature and emerging markets, and we remain committed to growing access and acceptance so that businesses and devices are enabled to send and receive funds via the Visa network.

For example, Visa has grown acceptance in the U.S.

vending machine category by enabling more than two million devices as new acceptance locations, which still leaves an estimated 50 percent of vending machines available for upgrade.

Street parking represents a similar opportunity.

Ensuring seamless experiences for cross-border transactions.

As commerce continues to flow across borders, we are simplifying and streamlining how funds flow for both consumers and businesses.

Cross-border ecommerce is also a growing opportunity.

Consumers purchasing something from a foreign website are expected to account for $900 billion in gross merchandise volume by 2020, representing an estimated 22 percent share of the global ecommerce market.

Enhancing inclusive financial access .

According to the World Bank, 1.7 billion people worldwide still lack access to formal financial services, which means they do not have access to the services that can help facilitate the growth of their economic livelihood.

As part of the World Bank’s goal of Universal Financial Access by 2020, in 2015 we committed to reaching 500 million consumers by 2020.

At the end of 2018, we reached 396 million consumers worldwide with first-time access to a digital payment product through a Visa-branded account in partnership with local financial institutions.

Our scan to pay service has emerged as one of our most successful low-cost acceptance solutions for merchants, enabling the growth of digital payments in developing economies and remote locations.

In some countries, the infrastructure for traditional payments technology simply may not exist.

With scan to pay, a business needs only to display a QR code to accept digital payments, saving the cost, time and complexity of installing a terminal and telecommunications wiring.

Scan to pay is already live in parts of Africa, Eastern Europe, the Middle East and Asia, with plans to expand into emerging markets of all sizes and regions.

In India, we continue to work with local acquirers to expand access and strengthen consumer demand for electronic payments.

The total acceptance points in India have expanded to more than five million, including more than one million QR points this year.

In Mexico, we are executing a program to grow the penetration of electronic payments, supporting the introduction of mobile point-of-sale (mPOS) and new acceptance technologies through our payment facilitator and acquirer partners.

Our social impact work also supports women’s empowerment and the expansion of financial inclusion through programs that support skill-development and access to networks and financial services for under and unbanked populations.

In January 2019, we launched She’s Next, Empowered by Visa, which connects women business owners to their communities, funding options and payment technologies through workshops, training and mentorship.

To date, Visa has signed up and hosted women entrepreneurs at workshops across North America, including Atlanta, Los Angeles, New York City, Toronto and Washington D.C.

Open Partnership Model

For more than 60 years, mutually beneficial partnerships have been fundamental to Visa’s business model.

We traditionally have operated in a four-party model, facilitating transactions between issuers, acquirers, merchants and account holders.

We continue to expand our acceptance footprint in both mature and emerging markets, so that businesses and devices are enabled to send and receive funds via the Visa network in categories such as vending, laundry, gaming, parking, electric vehicle charging, rent and tuition.

For example, in emerging markets, while 40% of the national GDP is contributed by small and micro-sellers, fewer than 10% of these sellers currently accept digital payments.

In January 2020, Visa announced Tap to Phone technology to help sellers accept digital payments without any additional hardware.

This technology allows micro-businesses to use smartphones to accept digital payments instead of a software terminal.

Promote inclusive financial access .

According to the World Bank, 1.7 billion adults worldwide still lack access to formal financial services, which means they do not have access to the services that can help facilitate the growth of their economic livelihood.

In 2015, Visa made a commitment to provide first-time access to a digital payments account for 500 million people worldwide by 2020 in support of the World Bank’s goal of Universal Financial Access.

We met this commitment ahead of schedule in 2019.

We are continuing this work by supporting women’s advancement, small businesses, and the expansion of financial inclusion through programs that support skill development and access to networks and financial services for under and unbanked populations.

For example, in June, we announced a global commitment to elevate 50 million small and micro businesses worldwide in an effort to help local businesses in the wake of the COVID-19 pandemic.

As part of the global commitment, Visa also formed the Visa Economic Empowerment Institute focused on economic and societal issues, including pandemic challenges small and micro businesses face and closing racial and gender opportunity gaps.

Fintech/Open Partnership Model

As the payment ecosystem grows, so too does Visa’s partnership model.

Today, our partnerships extend to technology companies, fintechs, governments and non-governmental organizations.

(2) _ http://www.ipc.be/services/markets-and-regulations/e-commerce-market-insights/e-commerce-articles/global-ecommercefigures-2017#infographic

Fintechs continue to be key enablers around the world in helping to expand access through electronic payments, open new points of acceptance, drive new payment flows and create new ways to pay and be paid.

Visa has the ability to help these companies grow and scale their payment innovations around the world, with increased safety and speed.

Visa is continuing to increase its reach and scope to address fintech needs by partnering directly with them and with the platforms that service them around the world.

We are designing Visa services to more efficiently meet our partners’ needs.

Visa Fintech Fast Track, a program that enables nimble start-ups to more easily scale and leverage the reach, capabilities and security Visa offers, is now available to clients globally.

Additionally, the new Visa Partner portal provides comprehensive services and resources — everything from information about API services to how to think about issuer processing — to help fintechs and all of our ecosystem partners bring new ways to pay to life.

Visa continues to make strategic investments in some companies that are enriching the broader payments ecosystem.

Through these strategic investments, Visa seeks to promote complementary, value-added services, enable new use cases, and expand the distribution and utility of our payments network.

New Payment Flows

Over the last several years, Visa has invested in expanding beyond C2B payments to capture growth in new payment flows such as P2P, B2C, B2B and G2C payments.

Fintechs are key enablers of new payment experiences and new flows.

Our work with fintechs helps to open new points of acceptance, create new digital banking experiences, move money across borders, embed Visa into B2B flows, speed up payroll and ensure digital wallet customers can access our services.

Fintechs prefer partnering with Visa because of the reach, capabilities, and security Visa offers.

Today, Visa has partnered with fintechs across categories including digital wallets, neobanks, “Buy Now, Pay Later”, B2B payments, cross-border remittance, payments infrastructure, and P2P payments.

To better serve fintechs, Visa has created a suite of streamlined commercial programs and digital onboarding tools.

Our Fintech Fast Track program enables qualifying fintechs to quickly launch and scale their programs.

The program has grown 360% year-over-year and has welcomed hundreds of fintechs who are actively engaged in the program.

With our startup engagement programs, the Visa Everywhere Initiative and the Inclusive Fintech 50, early stage companies can build payment solutions based on our capabilities.

All of our fintech resources are available online on Visa Partner, which provides a comprehensive set of services and resources so that partners can access APIs, apply for programs, complete an online licensing process and find relevant partners to help construct new flows.

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New flows represent a $185 trillion opportunity.

Visa’s network of networks approach creates opportunities to enable digital payments for consumers, businesses and governments around the world by facilitating P2P, B2C, B2B, B2b and G2C payments.

Today, partners are increasingly using Visa’s network infrastructure and capabilities to enable Visa to unlock a growing market opportunity.

Visa Direct continues to be one of the most meaningful ways in which we are capturing new types of payments that were previously made by cash, check or Account Clearing House (ACH).

Visa Direct, Visa’s real-time (3 ) push payments service, reverses the traditional card payment flow by allowing payment originators, through their acquirer, to push funds directly to cards, better meeting consumer and business needs.

For example, a ride sharing company can pay its drivers after a shift by transferring their pay directly to a Visa product.

Visa Direct helps enable domestic and cross-border payouts for consumers and small businesses in more than 170 countries.

Its capabilities modernize money movement, offering enhanced choice and convenience in how money is sent and received.

We have announced several Visa Direct partnerships that have helped drive transaction growth to more than 100 percent year-over-year growth this year.

(3) Actual fund availability depends on receiving financial institution and region.

Visa requires fast-funds enabled issuers to make funds available to their recipient account holders within a maximum of 30 minutes of approving the transaction.

Today, Visa Direct powers seven of the major P2P platforms in the U.S.

In the last year, Visa Direct transactions have been sent from 90 countries to the more than 170 countries where Visa Direct is currently available.

Cross-border payments have continued to be a focal point for Visa Direct, with key partnerships announced throughout the year.

With Visa Direct, Visa is extending the reach and capabilities of our global network to create a payment solution that is less constrained by time, borders or networks.

In July 2019, Visa acquired Earthport, which provides cross-border payment services to banks, money transfer service providers and businesses via one of the world’s largest independent ACH networks.

Before Earthport, Visa could reach about half of the world’s bank accounts, accessing them using Visa Direct and sending money to Visa credentials, such as debit or credit cards.

Through a combination of the existing Visa network and the addition of the Earthport network, Visa clients will soon be able to push payments to the majority of the world’s banked population, reaching more than 99 percent of bank accounts in 88 countries, including the top 50 markets.

Our vision is to enable our clients to reach bank accounts of consumers and small businesses in almost 200 countries via a single connection.

Integration efforts are underway, and we expect to launch a pilot of our first fully integrated Visa Direct and Earthport experience by the end of the 2019 calendar year.

Visa Direct is a global, real-time (2) push payments platform, which reverses the traditional card payment flow by allowing payment originators, through their acquirer, to push funds directly to cards, and with the acquisition of Earthport, Visa Direct can now also push directly to 1.5 billion additional bank accounts.

In doing this, Visa Direct supports consumer and business money flows, which is estimated to be $65 trillion, for a variety of payment use cases, including corporate, government and worker payouts, P2P, real-time merchant settlement, and fast cross-border payment capabilities to more than 140 countries.

Visa Direct enables Visa to capture new flows with nearly 3.5 billion global transactions in 2020.

This growth was fueled by the expansion of existing use cases, the extension of existing use cases to new countries, the development of new use cases, and the creation and deepening of partnerships worldwide.

P2P continued to be a strong contributor, with more than 100 P2P providers globally, led by a 75% year-over-year growth in global P2P transactions.

Additionally, we expanded P2P globally in domestic and cross-border capacities with many partners this year.

Many businesses also utilize Visa Direct to have real-time access to working capital to buy inventory, make payroll and service other cash flow needs to keep their businesses running, such as real-time merchant settlement and loan disbursements.

During fiscal year 2020, Visa Direct enabled faster payouts to more than 2.35 million U.S.

small businesses and sellers, helping to provide fast access to funds to improve cash flow.

In the wake of COVID-19, we are seeing more governments adopt Visa Direct to distribute funds quickly, safely and broadly, often reaching the unbanked.

We are also extending our network with B2B payments.

Businesses spend an estimated $120 trillion each year, offering tremendous room for us to continue to grow our business.

Our strategy is two-fold:

invest in and grow our existing commercial card solutions and capture new payment flows by innovating in the non-card payments space.

Our existing commercial card solutions generated more than $1 trillion in payments volume in fiscal year 2019, making Visa the largest card payment network for B2B payments in the world.

We offer a portfolio of business payment solutions, including small business, corporate (travel) cards, purchasing cards, virtual cards and digital credentials, non-card cross-border B2B payment options and disbursement accounts, covering most major industry segments around the world.

Businesses spend an estimated $120 trillion each year.

Our three strategic areas of focus include investing and growing card-based payments, accelerating our efforts in non-card, cross-border payments and digitizing domestic accounts payable/accounts receivable processes.

(2) Actual fund availability varies by receiving financial institution, receiving account type, region and whether the transaction is domestic or cross-border.

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Our existing commercial card solutions generated nearly $1 trillion in payments volume in fiscal year 2020.

We continue to invest across our small business, travel and entertainment, purchasing, fleet and virtual card solutions to further digitize how businesses pay other businesses.

In 2019, we commercially launched Visa B2B Connect, a multilateral network that operates separately from VisaNet and facilitates B2B cross-border transactions directly from an originating bank to the recipient bank.

Visa B2B Connect is a multilateral network that operates separately from VisaNet and facilitates B2B cross-border transactions directly from an originating bank to the recipient bank.

This network gives financial institutions the ability to quickly and securely process high-value corporate cross-border payments globally and helps simplify and speed up the way businesses pay other businesses around the world.

Visa B2B Connect’s current reach includes more than 60 countries with the goal to expand to more than 100 countries in 2020.

We are actively working with strategic partners and clients to increase the adoption of electronic payments in the accounts receivable and accounts payable space across large and medium-sized markets, as well as the small business category in key areas such as bill payment.

Visa B2B Connect’s current reach includes 80 markets, and we expect that we will expand to 30 new markets over the next 18-24 months, aiming to reach scale by 2022.

We are continuing to build out our capabilities and relationships to fuel future growth and to help our clients fulfill the international payments needs of their customers.

Value Added Services

As the payments category expands, both in scope and size, there is a growing opportunity to broaden our revenue streams by expanding the capabilities of our existing network in addition to selectively offering our services to other payment providers.

We are accomplishing this through both organic investment and strategic acquisitions.

Today, we offer several enhanced capabilities and services, including fraud prevention and security, processing, loyalty, merchant and digital solutions, consulting and data solutions.

Visa Consulting and Analytics

Visa Consulting and Analytics is the payments consulting advisory arm of Visa.

This group is a client-facing global team of several hundred payments consultants, data scientists and economists across six continents.

The combination of our deep payments expertise, our breadth of data and our economic intelligence allows us to identify actionable insights, recommendations and solutions that drive better business decisions and outcomes for clients.

As the payments category continues to evolve and expand in scope, size and complexity, our clients are increasingly looking for insights, and Visa is well positioned to support their needs.

Value added services represent an opportunity for us to help our clients grow their businesses, often resulting in additional growth for our core business.

In addition, they deepen our client relationships and deliver new sources of revenue.

Today, we offer a suite of value added services, including issuer and consumer solutions, merchant and acquirer solutions, fraud management and security services, data products, and consulting and analytics.

Issuer and Consumer Solutions

Visa DPS provides a wide range of debit, prepaid and credit value added services to clients including call center services, data analytics, campaign management, fraud and risk solutions, and a white-label branded mobile app.

client base includes national banks, community banks and credit unions, as well as a rapidly increasing number of fintechs.

DPS continues to extend and expand our capabilities in modern, API-based issuer processing solutions, which will be used for the U.S.

and international markets.

We also provide a range of other services and digital solutions to issuers, such as account controls, digital issuance, branded consumer experiences and installments.

Installment payments allow shoppers the flexibility to pay for a purchase in equal payments over a defined period of time.

Visa is investing in installments as a payments strategy — both by building our own solution, Visa Installments — and by partnering with innovative installments providers who leverage our assets to support a wider variety of installment options.

Visa Installments enables issuing banks to offer Visa cardholders the option to divide their total purchase amount into smaller payments during or after checkout, at the store and online — with a Visa card they already have in their wallet.

Through Cybersource, Visa’s global payment management platform, we are working with acquirers and fintech installment providers to enable this new way to pay for Cybersource’s merchant customers.

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Merchant and Acquirer Solutions

The Cybersource platform provides payment services for more than 450,000 clients.

Cybersource’s small business solutions are represented by the Authorize.Net brand in North America.

Through a single integration, Cybersource provides modular, digital capabilities beyond the traditional gateway function of connecting merchants to payment processing.

Using Cybersource, merchants of all sizes can improve the way their consumers engage and transact, mitigate fraud and security risk, lower operational costs and adapt to changing business requirements.

Cybersource’s global footprint lets merchants accept payments in more than 190 countries and territories around the world and includes a broad choice of acquirers and processors, payment types and hardware components.

Cybersource white-labeled capabilities continue to drive innovation in the payments ecosystem and enable better customer experiences.

Cybersource also invested in new and enhanced payment integrations with commerce platforms, enabling sellers and acquirers to provide tailored commerce experiences with payments seamlessly embedded.

Cybersource enables an omni-channel solution with a cloud-based architecture to deliver more innovation at the point-of-sale.

Our omni-channel solution has been adopted by multiple retailers in the U.S.

and in Europe.

Decision Manager delivered through Cybersource supports transaction security for sellers.

It leverages the power of network-wide fraud insights and combines it with hundreds of standard API elements, including IP addresses, device fingerprints, order details and analytics, to produce more than 260 detectors in addition to a score for every transaction to help sellers separate fraudulent transactions from non-fraudulent ones.

Decision Manager helps merchants reduce exposure to fraud, which is critical for optimizing both revenue and profits for merchants.

Visa continues to invest in its dispute management services.

In fiscal year 2019, we acquired Verifi, a leader in technology solutions to reduce chargebacks.

With this acquisition, Visa has been able to offer a network agnostic value added solution, enabling merchants to manage disputes across all their payment methods with a single connection.

Fraud Management and Security Services

Security and Identity

Trust is at the core of Visa.

Through an evolving and multilayered approach, Visa strives to expect the unexpected, constantly monitoring our network and sharing intelligence with our partners.

Our multi-prong security strategy is based on empowering consumers and clients through tools, resources and controls so that others can make more informed risk decisions.

Our multi-prong security strategy is based on empowering consumers and clients through tools, resources and controls to make more informed risk decisions.

To provide these tools, we invest in intelligence and technologies that improve fraud and authorization performance.

Visa Advanced Authorization risk scores every Visa-processed transaction in about one millisecond, an average of 379 million times a day.

In the last year, Visa’s artificial intelligence-powered risk scoring engine helped financial institutions prevent about $25 billion in fraud.

In fiscal year 2020, Visa Advanced Authorization risk scored 141 billion Visa-processed transactions – each transaction across more than 500 risk factors in about one millisecond.

In the last year, Visa’s artificial intelligence (AI)-powered risk scoring engine helped financial institutions prevent nearly $25 billion in fraud.

We believe security is an integral driver for growth and innovation.

Several developments over the course of 2019 help demonstrate our approach:

We continued to see the benefits of chip technology in preventing counterfeit fraud and reducing the amount and rate of fraud taking place in-person at physical stores.

In the U.S., for example, our most recent data shows an 87 percent decline in counterfeit fraud at chip-enabled merchants since 2015, when the industry began to deploy chip technology.

EMV® 3-D Secure (3DS) is a new generation of the protocol — developed by Visa, other payment brands and industry participants as part of EMVCo — and is designed to protect accounts from unauthorized use across desktop, laptop, mobile or other connected devices, making online purchases easier and more secure.

In 2019, Visa branded its 3DS program as Visa Secure (formerly Verified by Visa).

The Visa Secure visual badge, combined with descriptive language emphasizing, “Your online transactions are secure with Visa,” will be the way consumers encounter Visa’s 3DS offering.

Visa is also committed to helping protect the broader payments ecosystem from growing cyber threats through continued investments in intelligence and technology.

Companies today must be responsible for securing their businesses from increasingly sophisticated tactics by cyber criminals.

Visa provides a suite of capabilities that are a core benefit of being part of the Visa network.

Our security capabilities help protect the integrity of the payments ecosystem by seeking to detect and disrupt fraud threats targeting financial institutions and merchants.

We combine payment and cyber intelligence, insights and learnings from client/partner breach investigations and law enforcement engagement to help financial institutions and merchants solve critical security challenges.

Several developments over the course of fiscal year 2020 help demonstrate our approach:

• We continued to see the benefits of chip technology, where each transaction is accompanied by a one-time code that protects consumer information, in preventing counterfeit fraud and reducing fraud occurring in person at physical stores.

In the U.S., for example, our most recent data shows an 87 percent decline in counterfeit fraud at chip-enabled merchants since 2015.

Contactless-enabled payment cards use the same trusted security of chip cards.

EMV® 3-D Secure (3DS) is a new generation of the protocol — developed by EMVCo’s members along with other industry participants — and is designed to protect accounts from unauthorized use across desktop, laptop, mobile or other connected devices, making online purchases easier and more secure.

• A new digital tool was introduced to help U.S.

financial institutions with their efforts to combat new account fraud and give consumers greater peace of mind.

Advanced Identity Score combines Visa’s AI and predictive machine learning capabilities with application and identity related data to generate a risk score for new account applications to help reduce fraud, prevent negative impacts to brand loyalty and trust, and eliminate operational costs due to remediation.

Advanced Identity Score can decrease the number of new

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accounts opened with stolen identities, protect consumers against synthetic ID or account takeover fraud, save time and help eliminate a poor customer experience.

Visa is also committed to helping protect the broader payments ecosystem from growing cyber threats and fraud through continued investments in intelligence and technology.

Visa operates a suite of programs to protect the safety and soundness of the payments ecosystem, investing in intelligence and technology to prevent, detect and mitigate security threats, and empowering our partners with the tools and data necessary to make better risk management decisions that are a core benefit of being part of the Visa network.

Our security capabilities, programs and expertise help protect the integrity of the payments ecosystem by seeking to detect and disrupt fraud threats targeting financial institutions and merchants and removing bad actors from the ecosystem to provide the best possible consumer experience.

This is achieved through the combined efforts of payment and cyber intelligence, insights and learnings from client/partner breach investigations, and law enforcement engagement to help financial institutions and merchants solve critical security challenges.

Visa Token Service

Visa Token Service creates a secure environment to help drive innovation in online and mobile commerce.

The technology works by replacing a consumer’s card-related sensitive information, such as personal account number, with a unique identifier, or token , which protects transactions in a number of ways, including when a card or shopper is not physically present.

Launched in 2014, tokenization has been brought to scale over the last five years.

Visa Token Service is available in more than 100 markets.

In October 2019, Visa acquired the token services and ticketing businesses of Rambus Inc.

The combination of Visa’s card network tokenization capabilities with the local and account tokenization technology of Rambus will facilitate safer, more secure payments across a broader range of global commerce types.

Merchant and Acquirer Solutions

CyberSource’s product offerings are examples of Visa’s continued investment to deliver industry-leading products and capabilities to our merchant and acquirer partners.

The CyberSource platform enables merchants to accept payments online, in-app or on the mobile web and in-person.

CyberSource’s small business solutions are represented by the Authorize.Net brand in North America.

CyberSource provides modular, digital capabilities beyond the traditional gateway function of connecting merchants to payment processing.

As part of CyberSource's solution to acquirers, we are enabling acquirers to leverage our capabilities to drive more innovation in the payments ecosystem.

Using CyberSource services, merchants of all sizes can improve the way their consumers engage and transact, mitigate fraud and security risk, lower operational costs and adapt to changing business requirements.

CyberSource’s global footprint lets merchants accept payments in more than 190 countries and territories around the world and includes a broad choice of acquirer and processor partners, payment types and hardware components.

This year, we announced the acquisition of Payworks, a point-of-sale software solution that enables acquirers to support merchant terminal payments via the cloud, helping merchants seamlessly and quickly implement new functionality, designed to create better customer experiences and lower merchant operating costs.

Payworks will add in-store payment processing capabilities to CyberSource's ecommerce payment platform to create a fully integrated omni-channel payment acceptance solution.

Visa also completed the acquisition of Verifi, a leader in technology solutions to reduce chargebacks.

Verifi’s technology enables the quick resolution of disputes by connecting issuers to the data of more than 25,000 merchants as soon as an account holder calls with an issue.

This tool reduces costs and time spent for all stakeholders in a disputed transaction.

The foundations of our business are our technology, security, brand and talent.

Visa’s technology platform consists of software, hardware, data centers and a vast telecommunications infrastructure, each with a distinct architecture and operational footprint wrapped with several layers of security and protection technologies.

Visa Token Service is a security technology that helps combat fraud for both face-to-face and ecommerce digital transactions, including mobile and “Internet of Things (IoT)” payments.

The technology replaces a consumer’s card-related sensitive information, such as personal account number, with a unique, one-time use identifier, or token , which protects transactions in a number of ways, including when a card or shopper is not physically present.

Launched in 2014, tokenization has been brought to scale over the last six years.

We expanded tokenization globally this year, crossing the 1.4 billion tokens milestone and enabling more than 8,300 issuers across 192 markets.

Following the acquisition of Rambus Payments’ token services business, Visa rebranded the business unit to Token ID - A Visa Solution.

Token ID will expand Visa’s tokenization capabilities beyond card-based payments on the Visa network to include domestic card, automated clearing house (ACH) and real-time payment networks to facilitate secure payments across a broader range of global commerce types.

Data Solutions

Data lies at the heart of strategic decisions that governments, financial institutions, fintechs and merchants make to help meet their customers' needs, create new products and experiences, enhance security and bolster customer loyalty.

Visa harnesses the power of our rich global datasets to deliver insights, benchmarks and predictive models that benefit our ecosystem.

With Visa’s Benchmarking and Operations Solutions, clients can identify opportunities to increase spend and authorization rates and reduce fraud, disputes, chargebacks and operational costs.

Visa’s suite of Marketing Solutions uses Visa data to help issuers and merchants plan, target, and measure marketing campaigns and communications.

Through Visa’s Underwriting Solutions, Visa is helping clients harness data to improve portfolio management strategies such as credit line increase programs, cross sale of lending products and working capital management for small businesses.

Visa Consulting & Analytics

Visa Consulting & Analytics is the payments consulting advisory arm of Visa.

This group is a client-facing global team of more than 550 payments consultants, data scientists and economists in more than 100 cities.

Visa Consulting & Analytics offers consulting services for issuers, acquirers, merchants, fintechs and others that span the entire customer journey.

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The foundation of our business is comprised of our technology, security, brand and talent.

Visa’s technology platform comprises software, hardware, data centers and a vast telecommunications infrastructure, each with a distinct architecture and operational footprint wrapped with several layers of security and protection technologies.

Together, these systems deliver the secure, convenient and reliable service that our clients and consumers expect of the Visa brand.

As part of our global technology environment, we build and securely operate hundreds of commercial applications using a diverse set of technologies.

Our software powers the core functions of our transaction processing — including authorization, clearing and settlement, and risk scoring — as well as all of our value-added services.

Our software powers the core functions of our transaction processing — including authorization, clearing and settlement, and risk scoring — as well as our value added services.

These applications together work to provide essential services to the payments ecosystem.

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Our disaster recovery capabilities are tiered so that our real-time transaction processing services can be continuously available.

Visa operates six data centers that are a critical part of our global processing environment and are built with the capacity to support Visa’s growing power, cooling and space needs.

Visa operates four data centers that are a critical part of our global processing environment and are built with the capacity to support Visa’s growing power, cooling and space needs.

All of our data centers have high redundancy of network connectivity, power and cooling designed to provide continuous availability of systems.

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We invest significantly in our comprehensive approach to cybersecurity at Visa.

We deploy security technologies to protect against data confidentiality, integrity and availability risks, emphasizing core cybersecurity capabilities to minimize risk exposure.

We deploy security technologies to protect against data confidentiality, integrity and availability risks, emphasizing core cybersecurity

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capabilities to minimize risk exposure.

Our in-depth security approach applies multiple layers of protection to reduce the risk of any single control failing.

These measures include the following:

These measures include:

• A formal program to devalue sensitive and/or personal data through various cryptographic means

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We operate this platform globally, with teams in multiple time zones detecting and responding 24x7x365.

The Visa brand is one of the world’s most recognized, trusted and valuable brands.

Anchored on the notion that Visa is “Everywhere You Want To Be,” the Visa brand stands for acceptance, security, convenience, speed and reliability.

In recognition of its strength among clients and consumers, the Visa brand consistently ranks highly in multiple brand studies, including #1 on Forbes World’s Best Regarded Companies (2019), #5 on BrandZ Top 100 Most Valuable Global Brands (2019), Forbes World’s Most Valuable Brands and Interbrand’s Best Global Brands, among others.

Our brand strength helps us to deliver added value to financial institutions, merchants, clients and partners through compelling brand expressions, a wide-range of products and services and innovative marketing efforts.

In a consumer study by Visa in 16 countries, when consumers see the Visa logo, they are 3.5 times more likely to think the website is more secure.

In fiscal year 2019, we renewed our 25-year relationship with the National Football League, and continued our global sponsorship of FIFA, the International Olympic Committee and the International Paralympic Committee.

Visa is the only brand in the world that is a top sponsor of these properties, and is also the largest sponsor of women’s football in the world.

At the upcoming Olympic and Paralympic Games Tokyo 2020, this opportunity will be on full display when we will use our brand and technology to bring Japan’s vision for a future of digital payments to life.

Visa’s workforce continues to grow, increasing from approximately 17,000 employees in fiscal year 2018 to 19,500 employees in fiscal year 2019.

This growth has been fueled in part by acquisitions, with growth in the regions outpacing growth in the San Francisco Bay Area.

At the end of fiscal year 2019, Visa’s global workforce was 59 percent male and 41 percent female.

Increasing the representation of women and under-represented minorities remain an area of focus for management.

Visa’s commitment to diversity recruiting includes partnering with organizations such as AfroTech, AnitaB.org, Catalyst, Diversity Best Practices, the National Society of Black Engineers, the Society of Hispanic Professional Engineers, Watermark - Silicon Valley Conference for Women, Women in CyberSecurity, Women in Payments and many others to support and develop a diverse talent pipeline.

Visa is committed to pay equity for employees doing similar work, regardless of gender, race or ethnicity, and conducts pay equity analyses on an annual basis.

We assess employee engagement through our annual employee survey, which provides feedback on a variety of topics, such as company direction and strategy, diversity and inclusion, individual development, collaboration and trust.

For the second year in a row, we had an exceptional response rate of 95 percent with improvement in the survey results across the board and no items with notably declining scores.

In recognition of our strength among clients and consumers, the Visa brand consistently ranks highly in external brand studies, including #1 on Forbes World’s Best Regarded Companies (2019), #5 on BrandZ Top 100 Most Valuable Global Brands (2020), Forbes World’s Most Valuable Brands and Interbrand’s Best Global Brands, among others.

Visa’s brand strength helps deliver added value to our clients and their customers, financial institutions, merchants and partners through compelling brand expressions, a wide range of products and services and innovative brand and marketing efforts.

In line with our commitment to an expansive and diverse range of partnerships for the benefit of all our stakeholders, Visa sponsors FIFA, the International Olympic Committee, the International Paralympic Committee and the National Football League.

Visa is the only brand in the world that is a premier sponsor of all of these properties and also is the most active sponsor of women’s football around the world.

At the Olympic and Paralympic Games Tokyo 2020 (postponed from 2020 to 2021), the Visa brand is expected to be on full display when Visa features our products and technology to bring Japan’s vision for the future of digital payments to life.

Central to our long-term strategy is attracting, developing and retaining the best talent globally with the right skills to drive our success.

In fiscal year 2020, the COVID-19 pandemic had a significant impact on our human capital management.

A large majority of our workforce worked remotely throughout the second half of 2020, and we instituted safety protocols and procedures for the essential employees who continued to work on site.

Visa committed that no employee layoffs would occur in calendar year 2020 related directly to COVID-19.

Visa’s workforce grew in 2020 at a slower pace than prior years, increasing from approximately 19,500 employees in fiscal year 2019 to approximately 20,500 employees in fiscal year 2020.

Voluntary workforce turnover (rolling 12-month attrition) was 6.3% in September 2020.

At the end of fiscal year 2020, Visa’s global workforce was 59% male and 41% female, and women represented 34% of Visa’s leadership (defined as vice president level and above).

In the U.S., ethnicity of our workforce was 38% White, 42% Asian, 11% Hispanic, 6% Black and 3% other.

leadership, the breakdown was 63% White, 19% Asian, 12% Hispanic, 4% Black and 2% other.

Our culture is underpinned by our core values, including an unwavering commitment to inclusion and diversity.

In 2020, we established goals to increase the number of employees from underrepresented groups at the vice president level and above in the U.S.

by 50 percent in three years and to increase the number of employees from underrepresented groups in the U.S.

by 50 percent in five years.

Visa’s commitment to diversity recruiting includes partnering with a number of non-profit and community organizations to support and develop a diverse talent pipeline.

For example, Visa established the Black Scholars and Job program, a $10 million fund to create a dedicated Visa scholarship assistance program over the next five years, specifically for college-bound Black students.

Upon graduation, all recipients who have met their commitments will be guaranteed a full-time job with Visa.

Visa is committed to pay equity, regardless of gender or race/ethnicity, and conducts pay equity analyses on an annual basis.

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For additional information, please see the section titled “Talent and Human Capital Management” in Visa’s 2020 Proxy Statement.

Mergers and Acquisitions and Strategic Investments

Visa continually explores opportunities to augment our capabilities and provide meaningful value to our clients.

Mergers and acquisitions and strategic investments complement our internal development and enhance our partnerships to align with Visa’s priorities.

Visa applies a rigorous integration approach to our acquisitions and investments to ensure they will differentiate our network, provide value added services and accelerate growth.

Plaid Acquisition.

In January 2020, Visa entered into a definitive agreement to acquire Plaid, a network that makes it easy for people to securely connect their financial accounts to the apps they use to manage their financial lives.

Plaid’s products enable consumers to conveniently share their financial information with thousands of apps and services.

Visa’s acquisition of Plaid represents both an entry into new businesses and complementary enhancements to Visa’s existing business.

This acquisition is subject to customary closing conditions, including regulatory reviews and approvals.

On November 5, 2020, the U.S.

Department of Justice filed a complaint in the U.S.

District Court for the Northern District of California seeking a permanent injunction to prevent Visa from acquiring Plaid, alleging that the proposed acquisition would substantially lessen competition in violation of Section 7 of the Clayton Act and would constitute monopolization under Section 2 of the Sherman Act.

Visa intends to vigorously defend the lawsuit.

INTELLECTUAL PROPERTY

We own and manage the Visa brand, which stands for acceptance, security, convenience, speed and reliability.

Our portfolio of Visa-owned trademarks are important to our business.

Our portfolio of Visa-owned trademarks is important to our business.

Generally, trademark registrations are valid indefinitely as long as they are in use and/or maintained.

We give our clients access to these assets through agreements with our issuers and acquirers, which authorize the use of our trademarks in connection with their participation in our payments network.

We also own a number of patents, patent applications and other intellectual property relating to payment solutions, transaction processing, security systems and other matters.

Additionally, we have filed patent applications in the U.S.

and international jurisdictions covering certain aspects of our proprietary technology and new innovations, and own a number of patents, patent applications and other intellectual property relating to our business.

We rely on a combination of patent, trademark, copyright and trade secret laws in the U.S.

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These competitors may be more concentrated in specific geographic regions, such as JCB in Japan and Discover in the U.S., or have a leading position in certain countries.

For example, UnionPay operates the sole domestic card acceptance mark in China and is expanding into other global markets.

See Item 1A — Risk Factors — Regulatory Risks — Government-imposed restrictions on international payment systems may prevent us from competing against providers in certain countries, including significant markets such as China, India and Russia .

Based on available data, Visa is one of the largest retail electronic funds transfer networks used throughout the world.

For example, UnionPay is the largest player in China, since international card networks were not allowed to process domestic transactions in China until the market started to open up with the first license approval for an international network in fiscal year 2020.

See Item 1A — Risk Factors — Regulatory Risks — Government-imposed obligations and/or restrictions on international payment systems may prevent us from competing against providers in certain countries, including significant markets such as China, India and Russia .

Based on available data, Visa is

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one of the largest retail electronic funds transfer networks used throughout the world.

The following chart compares our network with these network competitors for calendar year 2019 (1) :

American Express

Visa Mastercard American Express JCB Diners Club

Payments Volume ($B) 8,941 4,767 1,225 313 179

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Total Transactions (B) 207 122 9 4 3

(4) MasterCard, American Express, JCB and Discover/Diners Club data sourced from The Nilson Report issue 1154 (May 2019).

Cards (M) 3,454 2,172 114 140 66

(1) Mastercard, American Express, JCB and Diners Club / Discover data sourced from The Nilson Report issue 1178 (June 2020).

Mastercard excludes Maestro and Cirrus figures.

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We believe Visa is well-positioned competitively due to our global brand, our broad set of Visa-branded payment products, and our proven track record of processing payment transactions securely and reliably through VisaNet.

SEASONALITY AND OTHER

We generally do not experience any pronounced seasonality in our business.

No individual quarter of fiscal 2019 or fiscal 2018 accounted for more than 30 percent of our net revenues in those years.

No individual quarter of fiscal year 2020 or fiscal year 2019 accounted for more than 30 percent of our net revenues in those years.

In fiscal year 2020, we had two clients that accounted for 11% and 10% of our total net revenues, respectively.

We believe this is the result of an unprecedented shift in revenue mix, including the decline in cross-border revenue as a result of the pandemic.

In fiscal year 2019 and 2018, no client generated greater than 10% of our total net revenues .

WORKING CAPITAL

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dollar generally remain outstanding for one to two business days, which is consistent with industry practice for such transactions.

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GOVERNMENT REGULATION

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Therefore, we do not permit financial institutions or other entities that are domiciled in countries or territories subject to comprehensive OFAC trade sanctions (currently, Cuba, Iran, North Korea, Syria and Crimea), or that are included on OFAC’s list of Specially Designated Nationals and Blocked Persons, to issue or acquire Visa cards or engage in transactions using our services.

Government-Imposed Market Participation and Restrictions:

Government-Imposed Market Participation Restrictions:

Certain governments, including China, India, Indonesia, Russia, Thailand and Vietnam, have taken actions to promote domestic payments systems and/or certain issuers, payments networks or processors, by imposing regulations that favor domestic providers, impose local ownership requirements on processors, require data localization or mandate domestic processing be done in that country.

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An increasing number of jurisdictions around the world regulate or influence debit and credit interchange reimbursement rates in their regions.

For example, the Dodd-Frank Wall Street Reform and Consumer Act (Dodd-Frank Act) in the U.S.

limits interchange reimbursement rates for certain debit card transactions, the European Union’s (EU) IFR limits interchange rates in Europe (as discussed below) and the Reserve Bank of Australia and the Central Bank of Brazil regulate average permissible levels of interchange.

For example, the U.S.

Dodd-Frank Wall Street Reform and Consumer Act (Dodd-Frank Act) limits interchange reimbursement rates for certain debit card transactions in the U.S., the European Union (EU) IFR limits interchange rates in Europe (as discussed below), and the Reserve Bank of Australia and the Central Bank of Brazil regulate average permissible levels of interchange.

Internet Transactions:

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Visa is also subject to oversight by banking and financial sector authorities in other jurisdictions, such as Brazil and Hong Kong.

European Regulations and Supervisory Oversight:

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European and United Kingdom Regulations and Supervisory Oversight:

Visa in Europe continues to be subject to complex and evolving regulation in the European Economic Area (EEA).

Visa Europe is designated as a Recognized Payment System in the United Kingdom, bringing it within the scope of the Bank of England’s supervisory powers and subject to various requirements, including on issues such as governance and risk management designed to maintain the stability of the United Kingdom’s financial system.

Visa Europe is also subject to the European Central Bank’s oversight, whose main focus is on the smooth operation of payment systems in the Euro area, including the security, operational reliability, and business continuity of the payment systems.

Furthermore, Visa Europe is regulated by the United Kingdom’s Payment Systems Regulator (PSR), which has wide-ranging powers and authority to review our business practices, systems, rules and fees with respect to promoting competition and innovation in the United Kingdom, and ensuring payments meet account holder needs.

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National competent authorities in the EU are responsible for monitoring and enforcing the IFR in their markets.

There are other regulations in the European Union that impact our business, as discussed above, including privacy and data protection, anti-bribery, anti-money laundering, anti-terrorism and sanctions.

Other recent regulatory changes in Europe, such as the second Payment Services Directive (PSD2), require, among other things, that our financial institution clients provide certain customer account access rights to emerging non-financial institution players.

There are other regulations in the European Union that impact our business, as discussed above, including regulations governing privacy and data protection, anti-bribery, anti-money laundering, anti-terrorism and sanctions.

Other regulations in Europe, such as the second Payment Services Directive (PSD2), require, among other things, that our financial institution clients provide certain customer account access rights to emerging non-financial institution players.

PSD2 also includes strong customer authentication requirements for certain transactions that could impose both operational complexity on Visa and negatively impact consumer payment experiences.

As discussed in Item 1A — Risk Factors — Business Risks — The United Kingdom’s withdrawal from the European Union could harm our business and financial results, Brexit could lead to further legal and regulatory complexity in Europe.

As discussed in Item 1A — Risk Factors — Business Risks — The United Kingdom’s withdrawal from the European Union could harm our business and financial results, and Brexit could lead to further legal and regulatory complexity in Europe.

Additional Regulatory Developments:

Various regulatory agencies also continue to examine a wide variety of other issues, including mobile payment transactions, tokenization, access rights for non-financial institutions, money transfer, identity theft, account management guidelines, disclosure rules, security and marketing that could affect our financial institution clients and us.

Furthermore, following the passage of PSD2 in Europe, several countries, including Australia, Brazil, Canada, Hong Kong and Mexico, are contemplating granting various types of access rights to third-party processors, including access to consumer account data maintained by our financial institution clients, which could have implications for our business as well.

Various regulatory agencies across the world also continue to examine a wide variety of other issues, including mobile payment transactions, tokenization, access rights for non-financial institutions, money transfer, identity theft, account management guidelines, disclosure rules, security and marketing that could affect our financial institution clients and us.

Furthermore, following the passage of PSD2 in Europe, several countries, including Australia, Brazil, Canada, Hong Kong and Mexico, are contemplating granting or have already granted various types of access rights to third-party processors, including access to consumer account data maintained by our financial institution clients, which could have negative implications for our business depending on how the regulations are framed and implemented.

AVAILABLE INFORMATION

was incorporated in Delaware in May 2007, and we completed our initial public offering in March 2008.

Prior to 2007 when Visa was reorganized, Visa served its member financial institutions through Visa International and regional member-owned associations (e.g., Visa U.S.A.

and Visa Canada Corporation).

As part of the 2007 reorganization, these associations became a part of Visa Inc.

in October 2007, with the exception of Visa Europe Limited, which continued to operate as an association until our acquisition in June 2016.

Please see Item 8.

Financial Statements and Supplementary Data-Notes to the Consolidated Financial Statements-Note 14-Stockholders’ Equity for information regarding our capital structure.

Our corporate website is http://corporate.visa.com .

Our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, proxy statements and any amendments to those reports filed or furnished pursuant to the Securities Exchange Act of 1934, as amended, can be viewed at http://www.sec.gov and our investor relations website at http://investor.visa.com as soon as reasonably practicable after these materials are electronically filed with or furnished to the U.S.

Our corporate website is usa.visa.com/about-visa.html .

Our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, proxy statements and any amendments to those reports filed or furnished pursuant to the U.S.

Securities Exchange Act of 1934, as amended, can be viewed at http://www.sec.gov and our investor relations website at http://investor.visa.com as soon as reasonably practicable after these materials are electronically filed with or furnished to the U.S.

Securities and Exchange Commission (SEC).

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business