Business Monday

Visa expanding its reach in Americas from Miami office

A view of 1004 NW 65th Ave. in Miami, home to the Visa headquarters for Latin America and the Caribbean, on Aug. 13.
A view of 1004 NW 65th Ave. in Miami, home to the Visa headquarters for Latin America and the Caribbean, on Aug. 13. FOR THE MIAMI HERALD

Visa got its start as a Bank of America credit card used in California in 1958.

Since then, it has evolved into a global system that processes electronic payments for consumers, businesses, banks and governments in over 200 countries and territories.

For more than 40 years, Visa has been operating in Latin America and the Caribbean. At first, the banks and other financial institutions in the region affiliated with Visa offered credit cards.

Today, they provide customers with Visa credit, debit, prepaid, cash-access cards and other financial services.

Visa is not a bank and does not issue credit or debit cards, extend credit or set interest rates charged to cardholders. It signs agreements with banks and other financial institutions that issue Visa cards and operates a worldwide processing network that carries out the authorizations, clearing and settlement of payment transactions. It earns money by charging fees to participating banks for processing payments of Visa credit, debit and prepaid cards. In addition, it receives fees for data processing and international transactions.

Visa’s services reach Latin America’s wealthy as they shop at chic Miami malls, as well as micro-businesses and low-income workers and pensioners.

Companies and governments in the region use Visa debit or prepaid cards to make payments to people who don’t have bank accounts (via cellphones), or to pay for employee meal plans and bonuses. Consumers linked to the Visa system can use mobile phones to buy groceries, pay the electric bill, and make and receive payments, even in the giant slum cities where there are no formal banking institutions.

“Electronic payments are critical to the development of strong, modern economies,” said Eduardo Eraña, who has been president of Visa Latin America and the Caribbean since 2002.

“These are times when fast, safe mobile payment technology will proliferate around the world, and throughout our region. Connected devices are changing everything we know about shopping and paying as commerce increasingly shifts from the physical to the digital world.”

He also pointed out that more than one-third of the world’s online population — estimated at three billion people — has already made a purchase online. “In the digital world, more and more commerce is moving from PCs to connected devices, including mobile phones, tablets and wearables like watches, bracelets and smart clothing, in both developed and emerging markets. Consumers are leading this shift as their appetite to adopt new technologies and devices increases at a remarkable rate,” Eraña said.

The Visa regional president, with more than 40 years of experience in banking, credit cards and electronic payments, joined Visa in 1984. He is responsible for all aspects of Visa’s business in Latin America and the Caribbean, and oversees relationships with the financial institutions that provide Visa services in the region.

A native of Mexico, Eraña graduated from the Universidad Nacional Autónoma de México (UNAM) with a degree in accounting and is a certified public accountant.

Visa opened its Latin America and Caribbean headquarters in Miami in the early 1980s and today covers 44 countries in the region. It also has operational centers in Brazil, Mexico, Colombia, Peru, Chile and Venezuela.

Visa has 316 employees at its regional headquarters in Miami, about 600 throughout the region and about 9,500 worldwide.

The Latin America and Caribbean region is an important part of Visa’s global network. It has more than 450 million Visa cards out of 2.4 billion worldwide. The total transaction volume for the 12 months ending June 30, 2015, was $1.04 trillion, out of the $7.4 trillion total for Visa Inc. Growth in credit and debit transactions, payments, and other categories for the region has been among the highest among the company’s five geographical divisions in constant-dollar terms, according to the company’s most recent quarterly report.

Visa’s investment in technology has been essential to keep ahead of growth in the customer base and increasing demand for mobile applications to handle electronic payments. Working with more than 14,000 financial institutions worldwide, Visa’s processing system — called VisaNet — is capable of processing 56,000 transaction messages a second, essential for a company that handles an average of 150 million transactions per day.

In a typical simplified transaction, a consumer presents a Visa-branded card to a merchant to pay for goods or services, say, in Sao Paulo, Brazil. The transaction information is then sent electronically to a financial institution that contracts with the merchant to accept Visa cards (called the “acquirer” by the payments industry) and routed by VisaNet to the issuer of the card (your bank, which could be anywhere in the world) for authorization. Following authorization, a file containing the transaction data is sent back to the acquirer and processed for final settlement between the issuing bank and the acquirer — which means someone gets paid and you owe more money on your credit card or have funds subtracted from your debt card account. All of this is done in seconds.

“Today, we’re at the beginning of another shift in the ubiquity of electronic payments,” Eraña said. “Almost any connected device can be transformed into a place where shopping, buying and paying happen. This is the new era of connected commerce.”

The writer can be reached at josephmannjr@gmail.com.

About the company

Business: Visa is a global payments technology company that allows consumers, businesses, governments and financial institutions in more than 200 countries and territories to use electronic payments. Visa is not a bank and does not issue credit or debit cards, extend credit or set interest rates charged to cardholders. It signs agreements with banks and other financial institutions that issue Visa cards and operates a worldwide processing network that carries out the authorizations, clearing and settlement of payment transactions. Visa’s worldwide network includes about 14,100 financial institutions and tens of millions of affiliated merchants. There are 2.4 billion Visa cards in the world, and the company earns its money by charging fees to participating banks for processing payments of Visa credit, debt and prepaid cards. It also receives fees for data processing and international transactions. Visa works in 44 countries throughout Latin America and Caribbean and has its regional headquarters in Miami.

World headquarters: San Francisco.

Latin America and Caribbean headquarters: 1004 NW 65th Ave., Miami.

President of Visa Latin America and the Caribbean Region: Eduardo Eraña, since 2002.

Founded: Visa traces its history to 1958, when Bank of America launched BankAmericard. This credit card grew and evolved over the years into an international network that includes credit and debit cards and other financial services. Visa Inc. was established as a publicly traded company in 2007.

Miami regional office: Set up in the early 1980s.

Employees: About 9,500 worldwide at the end of fiscal 2014 (Sept. 30, 2014), approximately 600 in Latin America and the Caribbean. The Miami office has 316 employees, not including others in a call center.

Revenues: $12.7 billion in fiscal 2014; more than $10.3 billion for the first three quarters of fiscal 2015.

Ownership: Visa Inc. is publicly traded. NYSE symbol: V.

Website: www.visa.com

Source: Visa

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