197.77 -0.08 (-0.04%)
After hours: 5:53PM EDT
|Bid||197.45 x 1100|
|Ask||197.80 x 1200|
|Day's range||195.68 - 199.18|
|52-week range||133.93 - 214.17|
|Beta (5Y monthly)||0.92|
|PE ratio (TTM)||35.59|
|Earnings date||21 Jul 2020 - 27 Jul 2020|
|Forward dividend & yield||1.20 (0.61%)|
|Ex-dividend date||13 May 2020|
|1y target est||209.29|
When investors think about e-commerce stocks, they often overlook Visa (NYSE: V) and Mastercard (NYSE: MA). Many online purchases are made with credit and debit cards, and Visa and Mastercard operate the two largest card processing networks in the world. Like an online toll road, Visa and Mastercard collect a small fee each time someone uses one of their cards to make an online transaction -- and the number of times this happens is soaring.
Kyle Dennis took a leap of faith and decided to invest his savings of $15K in the stock market — $2.8M later, he owes his success to these strategies
Given widespread disruption and uncertainty in the stock market, it is more important than ever to find high quality stocks for your portfolio. That means safe...
A combination of resilient business models and low payout ratios provide the opportunity for these companies to boost their payments.
Holding a stock over a very long period of time allows us to look past the day-to-day volatility of the market and allow a company to grow into what it can be years or decades from now. With that time horizon in mind, Disney (NYSE: DIS), Apple (NASDAQ: AAPL), Verizon (NYSE: VZ), Visa (NYSE: V), and Axon (NASDAQ: AAXN) are my buy-and-hold-forever stocks. Cable has been disrupted by streaming, and new entrants like Netflix (NASDAQ: NFLX) and Amazon (NASDAQ: AMZN) are now among the strongest players in the industry.
Warren Buffett is widely regarded as one of the best investors who ever lived. From 1964 to 2019, Buffett helped Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) generate an astounding 2,744,062% overall gain on its stock investments. For these reasons, investors wisely keep an eye on Berkshire Hathaway's portfolio to see which stocks Buffett is investing in.
(Bloomberg) -- Indian and U.S. technology companies are urging the Trump administration to reconsider an executive order freezing access to many work visas, warning the move would undermine a business model used to supply high-skill talent to clients from Wall Street to Silicon Valley.Donald Trump’s order last week halts approvals of a range of visas through year-end, including those for intra-company transfers and study-abroad programs, and is aimed at giving Americans preference after record job losses from the coronavirus pandemic. Key for the tech industry are H-1B visas used by workers from India and other countries to fill key roles.Visa processing is an elaborate, months-long affair so any disruption could hurt the ability of critical workers to travel to clients sites for an extended period. Already, the virus lockdowns have blocked consulate visits essential to the process and forced hundreds of thousands of workers into challenging work-from-home situations.India’s technology trade group, Nasscom, called Trump’s order “misguided and harmful to the U.S. economy” and warned it would exacerbate the country’s economic pain. Indian companies provide technology staff and services to U.S. hospitals, drugmakers and biotechnology companies, Nasscom pointed out. In addition, the industry may send more workers to Canada or Mexico without access to the U.S. market.“These are highly-skilled workers who are in great demand and they will be mobile no matter what,” said Shivendra Singh, president of global trade development at Nasscom.Among the other critics of the order were Alphabet Inc. Chief Executive Officer Sundar Pichai, Microsoft Corp. President Brad Smith and Tesla Inc. founder Elon Musk. Pichai, himself a beneficiary of the H-1B visa system in the 1990s, tweeted, “Immigration has contributed immensely to America’s economic success making it a global leader in tech, and also Google the company it is today.”Tata Consultancy Services Ltd., Infosys Ltd. and Wipro Ltd., among the largest outsourcing companies in Asia, declined to comment.India accounts for about 70% of the 85,000 H-1B visas issued annually, according to immigration data. Of this total, 65,000 visas are issued to foreign talent with bachelor’s degrees, while the remaining 20,000 can be allotted to workers who have more advanced degrees.The visa system was conceived so companies could hire overseas workers to fill a shortage of high-skilled talent in technology services and product development. The fact that Indian outsourcers collect a substantial share of the visas each year has made the program controversial, with critics arguing that companies abuse the system by replacing American workers with cheaper foreign labor.Soon after taking office, Trump vowed he would crack down on work visas and reform the “broken” immigration system. One longer-term concern for outsourcers is the administration’s planned revamp of the current H-1B visa program, which would replace the current lottery system for determining who gets visas with a merit-based system that prioritizes applicants based on wages. That would mean more workers with high salaries would likely receive visas.Now, outsourcing companies are dealing with the unpredictability of the visa situation and the prospect that an H-1B revamp could make it difficult to send anyone but the most critical of talent overseas.Trump Orders Freeze on Many Work Visas Through End of Year The most recent visa curbs could hammer outsourcers’ current model of talent deployment. Companies are beginning to question whether so much onsite travel is necessary, and some are ramping up local hiring or local subcontractors. The pandemic has prompted companies to look at worker clusters away from client sites but close enough to collaborate on projects. For instance, if a company has 20,000 employees spread across 40 cities, these could be aggregated in a few clusters and if the visa restrictions continue, the clusters may not be in Texas or New Jersey but in Canada or Mexico.“Offshoring could increase because, for clients, the virus lockdowns have already driven home the merits of remote working,” said Singh, speaking over the phone from New Delhi.Indian companies could see an impact on their margins because of increased worker salaries, higher costs of local hiring and subcontracting and the collateral damage from visa rejections and prolonged processing times. “The temporary suspension of H-1B visa programme till December 2020 will hamper execution of pipeline and new projects coupled with margin impact resulting from higher onshore hiring,” credit rating company ICRA said in a note last week.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
In the latest trading session, Visa (V) closed at $191.38, marking a +1.11% move from the previous day.
(Bloomberg) -- Visa Inc. and Mastercard Inc. are considering revoking Wirecard AG’s ability to process payments on their networks in a move that would cause further pain for the firm after it started insolvency proceedings.The world’s largest payment networks have begun reaching out to some Wirecard clients to prepare them for the possibility, according to people familiar with the matter, who asked not to be named because the information isn’t public.“We continue to closely monitor developments and assess new information as it becomes available,” Visa said in a statement. “Our priority is, and will always be, maintaining the integrity of the Visa payments system and protecting the interests of consumers, merchants and our clients.”Wirecard helps businesses around the world accept electronic payments from customers, so its relationships with Visa and Mastercard -- and being able to process payments with the companies -- are critical to its business.“Mastercard is aware of the news regarding Wirecard AG and is monitoring the situation closely,” Mastercard said in a statement. “Our priority is ensuring people are able to continue to use their cards. We will continue to work with all parties and stand ready to take any necessary action.”Wirecard filed for insolvency Thursday, citing over-indebtedness and inability to assure it can continue as a going concern. The announcement was the culmination of a stunning accounting scandal that led to the arrest of its chief executive officer and left the German payment-processing firm unable to find more than $2 billion missing from its balance sheet.Losing the licenses from Mastercard and Visa would exacerbate Wirecard’s situation. The company will have “no business” should the credit card companies decide to sever ties, Mirabaud analyst Neil Campling has said.The payments company has seen many other clients turn their backs on it since the scandal broke a week ago. Its share price is down 97% since then.Wirecard Bank, where the Visa and Mastercard licenses are held, isn’t part of the insolvency proceedings, the company has said. German financial regulator BaFin has appointed a representative for the lender.“In future, the release processes for all payments of the bank will be located exclusively within the bank and no longer at group level,” Wirecard said in a statement Thursday.A representative for Wirecard said it’s currently not making any additional statements.(Adds analyst comment and context on clients in seventh and eighth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Africa’s burgeoning mobile-banking industry has gained fresh momentum with governments boosting payments through phones, a measure aimed at curbing the coronavirus by reducing the physical exchange of cash.Kenya is ramping up its use of technology platforms offered by Vodafone Group Plc’s M-Pesa, Airtel Kenya Ltd. and Telkom Kenya Ltd. since the pandemic to disburse aid directly to businesses and individuals using mobile money rather than through banks or food parcels. Ghana on Wednesday also started pumping stimulus to at least 100,000 micro-, small- and medium-sized enterprises using mobile money.Pioneered by Vodafone’s Nairobi-based Safaricom Plc in 2007, mobile money has become an indispensable part of how Africa’s 1.2 billion people pay for goods and services, buy funeral cover or borrow money, without a smartphone. Now, the need from governments to find a quick and safe way of sending funds during the pandemic is underscoring the service’s increasingly systemic role.“Government disbursing monies via M-Pesa shows high integrity has been accorded to the platform,” said Tracy Kivunyu, an analyst at Tellimer Ltd. in the Kenyan capital, Nairobi.While Europeans are shunning cash for cards over hygiene concerns, some African nations lack the infrastructure to rely only on plastic. As restrictions on movement to curb Covid-19 infections prevent customers from accessing cash, more are turning to mobile money to fill the gap. After Kenya’s partial lockdown started in March, a million new users joined M-Pesa, taking subscribers to 25 million, or about three quarters of Kenyans over 15.In Ghana, mobile money purchases reached a record in March, according to central bank data, while a cash shortage in Zimbabwe means 90% of transactions are done digitally. Nigerian startup digital bank Kuda said it opened more accounts in April than the prior three months combined. Togo, a nation of eight million, was able to distribute emergency financial support to 500,000 people, mostly women, in less than two weeks using mobile phones, according to the International Monetary Fund.Top Market“These changes, triggered by Covid-19, have enabled the acceleration and scaling of cashless and digital economies,” said Serigne Dioum, head of mobile-financial services at MTN Group, the continent’s largest wireless carrier. “They support our ambition to transition to an end-to-end platform, creating a digital market place, connecting consumers to businesses, and businesses to businesses.”Mobile money is the fastest-growing source of income for wireless-network operators like Johannesburg-based MTN and the African units of Newbury, England-based Vodafone Group. Sub-Saharan Africa has more mobile-money accounts than anywhere else in the world, with about 396 million at the end of 2018, or 46% of all customers, according to the GSMA, the global mobile-operator industry group.Heightened reluctance to use potentially virus-spreading cash will probably continue once the economies rebound, Peter Ndegwa, the chief executive officer of Safaricom, who took the post in April, said in an interview. M-Pesa is used by more than 37 million people across seven African countries.The crisis has also quickened the next phase of M-Pesa’s development: a bigger push into financial services for Kenya’s small- to medium-sized businesses. Expanding revenue streams into business-related payments will help generate higher margins from M-Pesa’s ecosystem, said Tellimer’s Kivunyu.Safaricom has 173,000 merchant partners who can receive payments over M-Pesa and has the technology to enable more services once regulatory approvals are granted.“In terms of employment, the small business sector is the lifeline of this country,” Ndegwa said. That led to a partnership between Safaricom and Visa Inc. to explore and develop digital payment systems to further expand M-Pesa’s reach. It also ties into Safaricom’s strategy of coaxing more people onto 4G devices, which would let customers access more sophisticated financial services. Most Kenyans don’t have internet-enabled phones, so half of M-Pesa transfers are made via text message.In Ghana, companies other than mobile network operators can now get licenses, which could prompt a drop in prices with more competition, said Archie Hesse, CEO of Ghana Interbank Payment and Settlement Systems Ltd. Ghana is disbursing part of its 600 million cedis ($104 million) Covid-19 stimulus package via mobile money, said Kosi Yankey-Ayeh, executive director of the National Board for Small Scale Industries.The start of MTN’s mobile-money service in Nigeria in August, along with initial approvals for Globacom Ltd. and 9Mobile, means a sleeping giant is awakening in Africa’s most populous country, long served only by banks. Uzoma Dozie, CEO of Sparkle Ltd., a Lagos-based digital bank that began operations this month, expects to reach half a million customers in the next 18 months.“This pandemic has been a defining moment for mobile-money providers, said Akinwale Goodluck, head of Sub-Saharan Africa for GSMA. “It indicates that Africa can lead the world in digital financial transformation toward a cashless society.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Visa (V) ties up with TerraPay to develop and deliver solutions to drive repeat usage of the mobile wallets and digital currency for remittances.
(Bloomberg) -- Brazil’s Central Bank and antitrust regulator suspended Facebook Inc.’s WhatsApp messenger payment features in the country, the app’s second-biggest market with more than 120 million users.The bank decision aims to “preserve an adequate competitive environment, that ensures the functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap,” the monetary authority said in a statement on its website. Bank authorities requested that Mastercard Inc. and Visa Inc. stop payment and money transfer activities through the app.Meanwhile, Brazil’s antitrust regulator, known as Cade, said on Wednesday it is suspending WhatsApp’s partnership with electronic payment company Cielo preemptively. According to an statement on the regulator’s website, the vast WhatsApp user database coupled with Cielo’s high market share in payments could prove too high a barrier for any new competitors. Since the deal wasn’t presented for evaluation, regulators needed to act fast to avoid competition concerns, the statement read.A suspension without presenting further arguments is “an unusual, extraordinary move by the central bank, especially in payments arrangements and technology market,” said Tiago Severo Gomes, a partner at Caputo, Bastos and Serra and a specialist in fintechs and banking regulation.The decisions are a setback for Facebook, which introduced WhatsApp’s payments system in Brazil earlier this month after testing it over the past two years in a handful of markets, including India and Mexico. Payments are a key element of WhatsApp’s long-term plan to offer commerce within the app. More than 5 million merchants around the world use a business version of the messenger app, and in countries like India and Brazil, WhatsApp serves as the main or only online presence for many mom-and-pop retailers.“Our goal is to provide digital payments to all WhatsApp users in Brazil using an open model and we will continue to work with local partners and the Central Bank to make this possible,” a WhatsApp spokesperson said. ”In addition, we support the Central Bank’s PIX project on digital payments and together with our partners are committed to work with the Central Bank to integrate our systems when PIX becomes available,” the spokesperson said, referring to Brazil’s proposed instant-payment system.The company was surprised by the Central Bank’s decision, and the two sides were in regular contact in the run-up to the payments launch, said a person familiar with the talks who asked not to be named discussing private deliberations.Brazil’s Central Bank said the suspension will let it evaluate any possible risk to the country’s system of payments and to determine whether the payments system meets the necessary rules. Starting the service without the regulator’s green light could generate “irreparable damage to the system, especially what concerns competition, efficiency and data privacy,” the banks said, adding that Mastercard and Visa could face fines if they don’t comply.In a regulatory filing, Cielo said they suspended the services, and will keep the shareholders informed of developments.(Adds antitrust regulator comments in the third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Visa (NYSE:V), alongside nearly 20 leading small business solution providers, today announced a new online resource for small businesses, Visa Small Business Hub, to help entrepreneurs build stronger customer relationships and expand their businesses. With a focus on how to start, run and grow a strong, digitally-enabled business, Visa Small Business Hubs are now live in more than 20 countries and tailored to each region’s unique SMB needs. Each Small Business Hub delivers a broad range of tools, special partner offers and actionable tips that business owners can easily implement to improve their businesses.
Visa Inc. (NYSE:V) today announced that the company has now issued more than 1 billion tokens worldwide through Visa Token Service (VTS), marking a major milestone in its proprietary offering to help accelerate eCommerce innovation and make payments more secure. Visa Token Service replaces a cardholder’s 16-digit Visa account number with a secure token that protects the underlying card number from fraudsters.
(Bloomberg) -- Visa Inc. will dispatch workers to small businesses across the U.S. to help shops reopen and encourage additional use of its cards.The payment network’s efforts will start in the 50 largest U.S. cities in coming weeks, with Visa hoping to ultimately reach 200,000 small businesses. Workers will educate merchants on options they have for accepting electronic payments and provide them with new signs to let customers know they’re open.In some cases, the so-called street teams will give businesses signs that encourage customers to tap their credit and debit cards instead of dipping -- a technology that is relatively new to the U.S. and has gotten a boost from the pandemic, with virus-conscious consumers preferring contact-free shopping.“Tap-to-pay sits alongside face masks and hand sanitizer” at the checkout counter now, Suzan Kereere, Visa’s global head of merchant sales and acquiring, said in an interview. “That’s how shopping happens in this new normal.”The plan comes after Visa and its competitors were hit hard by the coronavirus pandemic. Spending on the firm’s cards slowed dramatically in recent months as governments around the world ordered businesses to close and people to stay at home to slow the spread of the deadly virus.Visa’s street teams are part of a broader company effort to help 50 million small businesses around the world as they begin to reopen. The network is also establishing the Visa Economic Empowerment Institute to study problems including post-crisis recovery and opportunity gaps, and is developing new card rewards to encourage people to shop locally.“It is unlikely that recovery will be a short spell,” Kereere said. “It will take some time for businesses and for most individuals to get back to whatever a new normal looks like.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Visa introduces Advanced Identity Score to help financial institutions prevent new account fraud by using AI to identify risk.
A Maryland multimillionaire says the biggest legal transfer of wealth in American history has just gotten underway—here’s #1 step you must take.
Visa (NYSE: V) today announced a global commitment to elevate 50 million small and micro businesses (SMBs) worldwide in an effort to get local communities back to business in the wake of the COVID-19 pandemic. Visa is introducing a range of locally designed programs and solutions to enable SMBs to drive efficiency and sales through acceptance of digital payments, building online businesses and incentivizing neighborhood support. As part of the global commitment, Visa also formed the Visa Economic Empowerment Institute (VEEI) focused on economic and societal issues, including pandemic challenges SMBs face and closing racial and gender opportunity gaps.
(Bloomberg) -- Markus Braun’s almost two decades as Wirecard AG’s chief executive officer ended after accusations about the company’s accounting culminated in a shock disclosure that it was unable to locate 1.9 billion euros ($2.1 billion).James Freis has been appointed interim CEO, the German payments company said in a short statement Friday. A recent hire and former compliance executive at Deutsche Boerse AG, Freis was only named as a member of the management board on Thursday.Braun’s exit comes after a catastrophic few days for Wirecard, which suffered a share price collapse after the two Asian banks that were alleged to be holding the missing cash denied any business relationship with the company.Read More: Germany’s Fintech Star Falls on Failure to Clean Up WirecardWirecard is now facing a potential cash crunch. The company warned Thursday that loans of as much as 2 billion euros could be terminated if its audited annual report is not published on Friday. Analysts at Morgan Stanley estimated that Wirecard has available cash of around 220 million euros if it cannot locate the missing $2.1 billion.Wirecard’s lenders are considering hiring outside help as they seek to navigate the risk of a potentially massive default, a person familiar with the matter said.Named CEO in 2002, Braun has put tens of millions of euros of his own funds into the firm. The value of his stake, which once made him a paper billionaire, has dwindled in the course of the rout.His replacement is stepping into an almost unprecedented situation. Freis wasn’t supposed to join until July, when he was going to be responsible for a newly created department called “Integrity, Legal and Compliance.”Freis was previously head of compliance at Deutsche Boerse AG, and held the position of Director of the U.S. Treasury Department’s Financial Crimes Enforcement Network, where he was responsible for the regulation of financial institutions.The interim CEO will need to quickly reassure Wirecard’s business partners. Wirecard has licenses with Visa, Mastercard and JCB International, through which Wirecard’s banking arm issues its credit cards. If Wirecard is unable to find its missing cash, Visa and Mastercard may have cause to revoke the licenses.“The big question is whether they retain the Visa and Mastercard licenses,” Neil Campling, analyst at Mirabaud said. “Without those they have no business.”Mastercard said it is following the developments at Wirecard but did not want to comment on specific customer conversations or situations. Visa did not have an immediate comment.Missing CashWirecard claimed on Thursday that auditor Ernst & Young couldn’t confirm the location of the missing cash that was supposed to be held at two Asian banks and reported that “spurious balance confirmations” had been provided.The confusion deepened on Friday when BDO Unibank Inc., the Philippines’ largest bank by assets, and the Bank of the Philippine Islands, said on Friday that Wirecard isn’t a client.“It was a rogue employee who falsified documents and forged the signatures of our officers,” BDO Unibank CEO Nestor Tan said in a mobile phone message. “Wirecard is not even a depositor -- we have no relationship with them.”A document purporting to show a link between Wirecard and the Bank of the Philippine Islands was “bogus” and may be part of an attempted fraud, the president of the Southeast Asian lender said in a phone interview.Wirecard shares plunged as much as 52% in Frankfurt on Friday. The selloff in Wirecard’s bonds also intensified, with the company’s 500 million-euro bonds maturing in 2024 falling a further 14 cents to trade at 24 cents. Its 900 million euros of convertible bonds are now indicated at less than 10 cents on the euro.Wirecard was worth 24.6 billion euros in September 2018 when it entered Germany’s Dax index, and widely considered as one of Germany’s few successful fintech stories. It was valued at about 2.4 billion euros on Friday morning.Wirecard spokespeople did not return calls and emails for comment.Historic SlumpWirecard’s reversal of fortune has caught its supporters off guard. Some of the company’s most loyal shareholders are now dumping their stakes as allegations of accounting impropriety engulf the German payments company. Analysts are also quickly changing their recommendations, despite continued concerns about the company’s accounting.As of Wednesday, 10 out of 25 analysts tracked by Bloomberg recommended buying the stock. Since then, at least nine analysts have removed their recommendations and three have downgraded the stock to sell.German financial markets regulator BaFin said it is also examining Wirecard’s disclosure on Thursday as part of its investigation into whether the company violated rules against market manipulation, according to a spokeswoman.BaFin has three investigations of Wirecard running: whether the company manipulated markets with its disclosures, whether Braun’s stock purchase ahead of the planned publication of the company’s annual report violated market abuse roles and whether the company and its management are fit to be the owners of a bank.Fraud ClaimsBraun has previously painted the company as a potential victim, resisting calls to resign and aggressively defending Wirecard against accusations of accounting fraud, led by a series of articles in the Financial Times.“It cannot be ruled out that Wirecard has been the victim in a substantial case of fraud,” Braun said in a statement published overnight.The company temporarily suspended its outgoing Chief Operating Officer Jan Marsalek, it said in a statement late Thursday. Marsalek -- who has been suspended on a revocable basis until June 30 -- had tried to get in touch with the two Asian banks and trustees over the past two days to recover the missing money, but wasn’t successful, a person familiar with the matter said Thursday. It’s unclear if the funds can be recovered, the person added.German politicians are now asking how such a rapid collapse could happen to a fintech company that was once worth more than Deutsche Bank, and previously supported by local regulators. Early last year BaFin took the unprecedented step of temporarily banning short sales of Wirecard shares following reports of suspicious accounting practices.“Markus Braun’s resignation was overdue,” said Danyal Bayaz, a lawmaker with Germany’s Greens. “Wirecard is not a small fintech, but a DAX member.”(Updates with statement from Visa and the Bank of the Philippine Islands.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Visa (NYSE: V) announced Monday that its technology has been selected for a new peer-to-peer (P2P) payments system in Facebook's (NASDAQ: FB) popular WhatsApp messaging software in Brazil. Visa did not specify financial terms or provide an estimate as to how the new arrangement would impact its business. The finance sector giant will utilize Visa Direct, a real-time push payments solution, to power the WhatsApp transactions.
With the aid of its technology platform, Visa (V) will add stimulus to Facebook's chat application, WhatsApp, to provide payment services in Brazil.
Visa and CPI Card Group® unveil a global industry-leading card, made with up to 98 percent upcycled plastic through exclusive agreement
(Bloomberg Opinion) -- After years of trying, American Express Co. is finally cracking into the China market. Now the hard work begins.On Saturday, AmEx got the green light to start processing yuan payments, making it the first of the big three U.S. card companies to get access to the mainland. The license, initially approved in 2018, gives AmEx a portal to some of the world’s biggest spenders, and will pit the company against state-backed China UnionPay Co., which dominates the market. Currently, holders of AmEx, MasterCard Inc. and Visa Inc. cards can only use them for foreign-currency payments outside China or on overseas websites. Competition will come not just from UnionPay cards, which dominate the market, but also mobile-payment apps, where Ant Financial’s Alipay and Tencent Holdings Ltd.’s WeChat Pay are big players. AmEx’s partner, LianLian, is tiny by comparison. To top it off, China is also testing out the digital yuan, another budding rival in the payment space. “Having a foreign branded card in your wallet used to mean you have made it in China, but now matters little,” says Zennon Kapron, the founder of a fintech consulting firm.Another challenge is that fees in China are lower than in the U.S., so companies need to win scale to make the big bucks: The card-clearing fee rate is 0.065% for domestic banks and the acquiring fee rate ranges from 0.5% to 1%. In the U.S., issuers like AmEx charge between 1.4% and 3.5%. AmEx and its Chinese partner will also have to convince local banks to issue cards processed on their network, and get more merchants to accept them. Because of the high fees it charges compared with rivals, AmEx tends to be used less in Asia and Europe. Still, there is money to be made if AmEx plays its cards right. One strategy that’s worked in the U.S. is offering plenty of rewards. A large card firm told Kapron, the consultant, that even with the thinnest slice of the market, it would still be profitable. There will always be spenders who like premium cards they can use at home and overseas, he says.Banks, too, could benefit from choice beyond UnionPay, notes James Lloyd, Asia-Pacific fintech leader at Ernst & Young LLP in Hong Kong. More competition can only be a good thing for their merchant clients and cardholders.To AmEx’s credit, just getting to this point is a step in the right direction. It’s been a long slog.(2) Both Visa and MasterCard have been waiting since 2006 to gain access to China. AmEx cleared a key hurdle in early January when regulators accepted its application to start a bank-card clearing business with LianLian. Last March, MasterCard refiled its application, raising its stake in a joint venture with NetsUnion Clearing Corp., or Wanglian, a clearing house for online payments. There’s little clarity on the progress of Visa’s application, which was made in July 2018 without a mainland partner. Of course, there is a whiff of politics in the timing of all this. As tensions between Washington and Beijing intensify amid the coronavirus outbreak, China appears to be holding up its end of the phase one trade deal. The preliminary agreement signed in January included measures to speed up the opening of mainland financial markets, with plans to accelerate approvals for AmEx, MasterCard and Visa, specifically. By starting with AmEx, Beijing is picking off the low-hanging fruit; its mainland partner stands to benefit from any increased business, too.But with Covid-19 wreaking havoc on the economy, it’s going to take more than Beijing’s blessing to get shopaholics back in force, beyond some revenge spending. AmEx, whose slogan is “Don’t Live Life Without It,” may find becoming indispensable in China its toughest sell yet. (1) In 2012, the World Trade Organization ruled in favor of a U.S. claim that argued foreign payment providers should have been given access to the domestic clearing market in 2001, when China acceded to the WTO.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.