International Transactions on the Internet – The Visa difference

Visa is a payment system provider that makes money flow by enabling cardholders, retailers and banks to do business with each other.  For year ending December 2005, total global debit and prepaid sales and cash volume topped US$2.13 trillion, compared to US$1.78 trillion for the same period in 2004. (see sources).  Ranked as a top 100 globally recognised brands, VISA provides the products and services that make electronic transactions fast, secure and convenient.  Having access to this payment facilitator will serve to enhance the efficiency of conducting business on the Internet. 

However, access to VISA varies globally, resulting in the differing scale of usage from country to country.  In the economic environment of developing countries such as Nigeria, VISA is limited to a handful of banks and the conditions that need to be met to qualify for the card is beyond what most of the citizen can meet.  A consequence of this is a lack of a financial infrastructure to support VISA.  In contrast to this VISA is the main issuer of cards in the UK where access and usage to this facility is the standard.  And this is not just the developing versus the developed country thing.  There is even a difference amongst the developed countries.  The most obvious example is Germany, where the preferred method of payment is ELV (electronic debit or Lastschrift).  The contradictory condition of both these environments means that the Internet entrepreneur that conducts business in both environments has to find ways to accommodate both sides of the coin. 

Advantage of Small and Medium Enterprises (SMEs)

In order to complete transactions the successful Internet business must be flexible to the demands of both environments.  The inability to adapt to the environment of the host markets has been a major reason for the failures of large multinationals operating in foreign markets.  This gives an advantage to SMEs and dealing with SMEs on the Internet is not unusual.  The fact is in most national economies SMEs account for the majority of business establishments.  They are more flexible and willing to adapt to market changes.  Their strength is their ability to exploit new technologies, and to respond quickly to changing market needs.

The Internet has been a major protagonist in the increase in popularity of cross-border shopping and consumption, and is an ideal opportunity for SMEs take advantage of a supply gap particularly when dealing with economies that have different standards of payment.  From an entrepreneur point of view having an Internet business that provides access to international shopping that is compatible with all environments takes a certain talent that gives a competitive advantage.  Providing options such as direct bank payment or cash on delivery is just some of the alternative payment options that will enable the savvy Internet entrepreneurs to capture an otherwise untapped pool of consumers.

From a consumer point of view not having access to VISA should not deter them from international shopping on the Internet.  We would all like the chance to buy those must have latest shoes, electronic gadgets, books, clothes etc. But it is important that consumers can find a site that will cater for the payment facility that they have access to.

Source

VISA http://corporate.visa.com/media-center/press-releases/press293.jspnote 25