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Wednesday 20 September 2017

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Visa initiative fuels API-fication of payments

Written by Scott Thompson
05/02/2016

Visa is to give software application developers open access to its technology, products and services with the launch of Visa Developer. The new platform will initially offer access to the likes of account holder identification, person-to-person payment capabilities, secure in-store and online payment services such as Visa Checkout, currency conversion and consumer transaction alerts. The plan is to introduce more of its payment capabilities over the next year. Over the past few months, financial institutions, technology companies, and startups have participated in beta trials of the new platform. These include Capital One, CIBC, Emirates NBD, National Australia Bank (NAB), RBC, TD Bank, Scotiabank, TSYS, U.S. Bank and VenueNext.

Gilles Ubaghs, senior analyst, financial services technology at Ovum, comments: “The explosion in growth for payment providers such as Stripe and Braintree has provided a broader shift in thinking in the payments space, with a focus on developer friendly tools,that are flexible and easy to deploy. Whereas traditionally, the choice of payment provider was largely an accounting and finance issue, developers have now come to the fore as key decision makers in payments. The API-fication of payments will continue to gather momentum, and has the potential to lead to a significant increase in new payment services and functionalities.”

He adds that, by providing the tools for developers in startups, and amongst major enterprises, this ultimately helps protect Visa from the risk of disintermediation. Its brand visibility will likely fall into the background in some deployments, but the company will nonetheless form the backbone of these services. This will help to ensure transaction volumes remain high in an increasingly cardless world, and keep Visa at the centre of the digital payments ecosystem. This also means that newer Visa services, such as tokenization, and P2P push payments can spread more rapidly to a wider end user base than may have been possible on a traditional bank by bank approach.

Ubaghs adds: “Perceptions are slowly changing as Visa expands its technological services and offerings, but Visa Developer’s direct appeal to the developer community gives it scope to circumnavigate existing bank partners and significantly increase its role in the broader digital payments market. By expanding its positioning, particularly in terms of live deployments and on the ground offerings, this will help to speed up its strategic realignment with its core bank partners.”



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