SAN FRANCISCO – Visa Inc. has launched its answer to online shopping woes for consumers and merchants alike – Visa Checkout, a new product that’s geared towards making e-commerce and mobile payments quicker and simpler.
On Tuesday, the payments processor and financial services giant announced Visa Checkout’s debut in the U.S. Right now, the biggest pain point for retailers is when consumers put items in their shopping cart but then abandon them, often because it’s tedious to enter their billing and shipping information. Visa Checkout is meant to tackle that problem, said Sam Shrauger, Visa’s senior vice president of digital solutions.
He demonstrated how consumers can quickly set up a username and password and instantly add Visa credit and debit cards to their accounts. When they go to pay for an item at an online store, they simply pick their card or use a default one, without being redirected away from the page they’re visiting.
“[We’re] creating the digital version of the card online, from Visa, a brand that people know and trust,” Shrauger said. However, he added the company isn’t really interested in creating a new digital wallet.
“A lot of this is just to focus on the absolute simplicity of payment, no bells and whistles, no wallet this, wallet that. Just give me a form of my cards digitally that’s as easy to pay with online and digitally, as they are in the physical world.”
So far, the company has partnered with large U.S. brands like Pizza Hut, Neiman Marcus, United Airlines, and Staples. It is also working with more than 180 payment card issuers and financial institutions around the world, like the Bank of America and U.S. Bank.
Here in Canada, consumers may notice Visa Checkout being rolled out in the fall, though its official release is set for sometime in spring 2015. Canadian merchants include Cineplex Entertainment, Beyond The Rack, World Vision, ClearlyContacts.ca and Cymax Canada.
Visa also announced two new software development kits for iOS and Android, as well as plans to unveil an aggressive, “multimillion-dollar” advertising campaign to get consumers interested in the product.
And to ensure Visa Checkout is secure, the company provides triple encryption of data, multifactor authentication, and other layers of security, but it may consider adding on features of tools like Verified by Visa in the future, Shrauger said.
Yet while Visa Checkout is a good step forward, it’s not exactly groundbreaking, said Christie Christelis, a mobile payments analyst with TSI Globalnet. He said he sees the new offering as a way of competing with other heavyweights in the payments space, like PayPal or MasterCard, which announced MasterPass in February 2013.
“I do think it’s in [Visa’s] interest for them to go this route. MasterCard’s already out there, PayPal’s already out there, who’s missing?” he said, adding Visa appears to be going after larger merchants, rather than small businesses that typically work with PayPal.
“It’s not really a world-shaking development, but a necessary development for them to remain current and to provide customers with a way that doesn’t go through an intermediary like PayPal.”
However, Visa executives say they’ve done a lot to make Visa Checkout an appealing offering. In 2011, the company unveiled V.Me, its first stab at creating a digital wallet. While that product didn’t see widespread adoption, it did provide some takeaways on how to improve Visa Checkout.
“What we’re trying to do is make the cardholder experience better in an online and mobile world. And we think if we do that, and we think if we do that with as little friction as possible, as great as an experience as possible,” Shrauger said. “Cardholders will migrate to things that give them the best experience and that is where we’re focused.”
Watch Visa’s video for Visa Checkout here:
https://www.youtube.com/watch?v=u_IIY0qTszk