"Visa: COVID-19 Accelerated Cashless Society... It Will Be an Opportunity, Not a Crisis"

[Asia Economy Reporter Koo Eun-mo] Although Visa's sales are inevitably impacted this year due to the spread of the novel coronavirus infection (COVID-19), analysis suggests a recovery is expected from the second half of the year. The cashless society accelerated by COVID-19 is anticipated to act not as a crisis but as an opportunity for Visa, boosting its growth rate.

Jae-woo Kim, a researcher at Samsung Securities, stated in a report on the 12th, "Visa's revenue structure is entirely influenced by the volume and amount of card payments," adding, "Visa has already lowered its sales guidance for the second quarter of fiscal year 2020 through two disclosures in March."

However, he evaluated that market expectations for a simultaneous recovery in Visa's sales remain high if consumption normalizes in the second half of this year. Researcher Kim added, "Some even suggest the possibility of 'revenge spending,' where suppressed consumption rapidly rebounds once social distancing measures are eased."

Paradoxically, various measures taken by countries to prevent the spread of COVID-19 are expected to accelerate the transition to a cashless society, increasing Visa's growth rate compared to the pre-COVID-19 period. Researcher Kim explained, "As non-cash payments rapidly replace traditional cash payments, changes in consumer perception toward non-cash payments, the expansion of experienced users, and the swift establishment of infrastructure for non-cash payments are all contributing factors."

He added, "Furthermore, the expansion of non-face-to-face services by financial companies and the growing need for digital currency, combined with Visa's active mergers and acquisitions (M&A) and investment behavior focused on the fintech sector, could serve as additional growth opportunities."

This content was produced with the assistance of AI translation services.