Visa (V) Ties Up For Faster Digitization of B2B Payments

Visa Inc. V recently announced that it has collaborated with Conferma Pay to introduce Visa Commercial Pay in an effort to accelerate digitization of business-to-business (B2B) payments thereby benefiting not only Visa’s commercial clients but also several financial institutions and their corporate customers. Notably, Conferma Pay, which is a leader in offering virtual payments technology, seems to be a suitable partner for Visa’s latest move.

Shares of Visa have gained 0.7% on Nov 24.

Visa Commercial Pay entails a suite of three B2B payment offerings, which aid in enhancing business cash flows and paving the way for automated payment processing. Through the first offering, Visa Commercial Pay Mobile app, employees and contractors can have access to digitally-issued Visa virtual commercial cards via their mobile devices.  This, in turn, relieves the card issuing company of issuing and mailing cards through physical means. Users can utilize the virtual cards for conducting online or in-store business purchases more efficiently.

The second offering is a solution named Visa Commercial Pay Travel, which provides not only enhanced visibility into business travel expenses encompassing air or hotel but also leads to automated expense reconciliation. The final offering named Visa Commercial Pay B2B offers a platform, which leverages the strengths of both Visa and Conferma Pay. The platform enables companies to select the appropriate solution for efficient management of cash flows and equipping them with improved reconciliation and reporting capabilities.

Shares of Visa have gained 14.9% over a year compared with the industry’s growth of 8.3%.

Among its peers, shares of American Express Company AXP has inched up 0.5% in a year, while that of Discover Financial Services DFS has lost 3.7% in the same time period.

It has to be noted that the coronavirus outbreak severely impacted the B2B payments space as stringent lockdowns and social-distancing measures compelled employees to work from home. As a result, the inefficiency of time-consuming manual and paper-based processes prevailing across the B2B space caught the eye. Hence, shift to digitization for B2B payments, which was already underway for quite some time, gained momentum amid the pandemic.

The launch of Visa Commercial Pay seems to be time opportune considering the dire need for virtual commercial cards. The utlization of which paves the way for making secure digital payments and closely monitoring B2B spend while at home. Further, it helps the B2B payments space to eliminate time consuming and outdated payment processes. What makes the latest offering noteworthy is that it is devoid of any added development or operational complexities, which generally comes hand-in-hand with introduction of capabilities.

Moreover, Visa has been making every effort to expand its reach across the vast B2B payment market, which remains well-poised for growth on the back of expanding real-time payments, elevated smartphone penetration, and increased business process automation.

Visa B2B Connect, the commercial launch of which took place last year, is a non-card based payment network enabling seamless bank-to-bank cross-border B2B transactions. The company has also worked closely with several financial institutions for rolling out enhanced solutions targeted to benefit the corporate clients ranging from small and micro businesses (SMBs) to multinational firms. These initiatives have positioned Visa well to tap the growing opportunities prevalent in the B2B payment market.

Notably, Visa currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Mastercard Incorporated MA, which shares space with Visa, strives to bolster the company’s reach in the vast B2B payment market through its unique solution, Mastercard Track Business Payment Service.

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