Charlie Scharf On Visa Europe, EMV Migration, Visa Checkout Evolution

JPMorgan’s annual Global Technology, Media and Telecom Conference is being held this week, and on Monday (May 23), Visa CEO Charlie Scharf got a chance to present Visa’s point of view on four very strategic aspects of its roadmap: Visa Europe, China, EMV and digital payments.

Here’s a few excerpts of what Scharf said on those trending topics.

Visa Europe

“We’re very excited about Visa Europe. As I think you know, those of you who followed us know we renegotiated the earn-out, and we filed our applications with the European Commission, which is the last approval that we need. And they put out something last week that said that they expected to reach a decision by June 15, which is great for us. So, we are hopeful that will close around the end of the quarter.”

Visa’s China Footprint

“China is a complicated one. So, just as a refresher, we cannot compete domestically in China today … It will be probably a year to year-and-a-half process before we’re actually able to process our first transaction domestically within China. I have been very, very consistent on this — that we view this as a long-term opportunity. It’s going to require some investment but not a crazy amount of investment. And it’s an opportunity where we think we can add value to both the banks and the consumers, as well as the merchant community in the Chinese marketplace … It’s a long-term play. We’ll see how the market develops, and time will tell.”

Chip Card Evolution

“The movement from magstripe to chip is taking place faster than it’s taking place in any other market in the world. And absolutely, we’d love to see it happen even quicker than that, but it takes time. It’s not just a question of issuing the card; it’s a question of — it’s not a question of buying the terminal, [which] very often leads to get[ting] integrated into someone’s operating environment. Very often, there are things like loyalty programs that are embedded in these machines, other experiences people like to use a[t] checkout, and it takes time.”

The Chip-And-PIN Debate

“If a merchant wants the customer to use a PIN for whatever reason, for security reasons, for their own economic reasons, they have the ability to steer the consumer towards that method of payment. But our view is ultimately: If a consumer decides that they’re not comfortable using the PIN at the point of sale, which 90 percent of the consumers tell us in our research they’re concerned about, half of them say they’re extremely concerned about using it because of that — the possibility of having the PIN stolen, the card stolen and then having someone [have] access to all of their banking things. We don’t think it’s right to push consumers beyond a place where they want to go.”

Visa Checkout Evolution

“We don’t view Visa Checkout as the one thing that has to be successful. We’re lucky enough that we don’t have to pick and choose consumer experiences that will win in the marketplace … And if we can ensure that we and our clients and their clients conduct commerce in a frictionless way, where we capture those payments, if it’s Visa Checkout, that’s great; if it’s one of the other pays or the other ways to be paid, we’re fine with that as well. And ultimately, that’ll do. If we are growing our share of digital commerce, that’s the way we’ll view success. It might be Visa Checkout; it might be one of the other things. So far, Visa Checkout is doing well. We have about 12 million consumers online continuing to build the addressable volume. I make very clear: It’s a long-term, merchant-by-merchant build on the acceptance side.”

The full transcript of this conversation can be found here.