Visa’s Earnings Spotlights Momentum in B2B Virtual Card Acceptance

Visa’s earnings call Tuesday (July 23) night offered up insight into new payment flows, continued acceptance of virtual cards, and the ways in which business-to-business (B2B) transactions are moving into digital channels.

During the conference call with analysts, CEO Ryan McInerney said that “our products and solutions in B2B remain very important in winning and growing our business.”

New payment flows — which include B2B offerings — were up 18% year over year, as management said earlier this year during another earnings call, the total market for those flows represents a $200 trillion opportunity.

In B2B, the company has “focused on penetrating new verticals,” and offered up the example where the payment network is working with AXA and Paysure to launch a commercial virtual card solution to simplify the claims process. Visa, he said, has also expanded virtual card acceptance through business services provider Cintas, which offers uniform, safety and fire protection services to over 1 million customers.

PYMNTS Intelligence data indicates firms not using virtual cards also happen to experience an average revenue loss of 4.6% from payment uncertainties.

Outside the states, he said, and in illustration of data in the service of modernizing B2B money movement, McInerney detailed that in working with Celero, a business financial management solution, Visa is leveraging data to give issuers with enhanced visibility into small business spend by aggregating data across cards and bank accounts.

Commercial Volumes Up

Within Visa Direct, overall transactions grew 41% for the quarter to 2.6 billion transactions  and commercial volumes up 7% year over year in constant dollars, management said during he call.

The company’s filings with the Securities and Exchange Commission note that nominal commercial payments volume in the U.S. was up 6% to $253 billion, and international commercial payments volumes surged by 9% year over year to $149 billion.

Value-added services revenue — where Visa works with other businesses, including financial institutions, enablers and networks to enable instant payments across a variety of use cases — grew 23% in constant dollars to $2.2 billion, primarily driven by issuing and acceptance solutions and advisory services. McInerney noted the growth in this segment, as quarterly revenues are starting to approach what, previously, were annual tallies. In “2021, we did about $5 billion in revenue; 2022, $6 billion. Last year was $7 billion,” McInerney said.

Separately from the earnings announcement and details, and as spotlighted here, Alan Koenigsberg, senior vice president and global head of large, middle market, industry verticals and working capital solutions at Visa, told Karen Webster that consumer-like experiences online will help bring analog B2B interactions fully into the digital realm.

One of the key innovations Visa has focused on, according to Koenigsberg, is the “reassembly” of financial products through partnerships, such as with SAP’s Taulia. The partnership brings together Visa’s digital payments technology and Taulia virtual cards, a solution that integrates with SAP’s enterprise resource planning offerings and business applications.