Monday 19 August 2019
 
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Sam Shrauger

Visa unveils new instalment payment solutions

DUBAI, July 4, 2019

Visa, a leader in digital payments, said it is providing shoppers the ability to choose how they pay before, during or after purchase with the introduction of a suite of its instalment solutions APIs (application of programming interface).

Through a pilot programme, participating issuers and merchants will be able to offer their customers an instalment payment experience at checkout using a Visa card they already have in their wallet, said a statement from the company.
 
With the instalment solutions, Visa cardholders will have the option to divide their total purchase amount into smaller, equal payments over a defined time period on qualifying purchases, at the store and online or while traveling abroad, it said.

Sam Shrauger, senior vice president, global head of issuer and consumer solutions, Visa, said: “Our instalment capabilities are changing the game by allowing issuers to leverage an existing payment account consumers already have and are familiar with, instead of asking them to submit to a credit check, download an app or open another line of credit.”

“We expect instalments to become a foundational method of payment at checkout for both domestic and cross-border commerce payment transactions,” he said.

Visa is partnering with clients around the world to pilot a variety of instalment use cases. CyberSource will be a leading payment management platform to support Visa’s instalments capabilities for its participating merchant clients and acquirer partners that utilise CyberSource for global payments enablement.

Additionally, MakeMyTrip integrated with Simpl platform and Kotak Mahindra Bank in India, Alpha Bank, eMAG, ING Bank Romania and PayU in Romania, Russian Standard Bank in Russia and Abu Dhabi Commercial Bank and Mashreq bank in UAE are all piloting Visa’s instalments capabilities.
 
Visa’s instalment solutions aim to simplify today’s friction-filled and time-consuming instalment process at checkout for buyers and sellers. Online shoppers today are typically presented with an instalment offer at the final checkout screen, said the statement.

Consumers are then required to sign up with a designated provider, apply for a line of credit and – if approved – use their funds toward a given purchase. Each time a consumer shops with a different merchant who offers a different instalment capability, they need to complete the same process again to obtain a new line of credit.

Merchants can leverage cardholders’ existing relationships with financial institutions to provide Visa’s instalment solutions at the point of sale – online or in store – through a single API-based integration. This will ultimately help merchants enhance sales, improve customer loyalty and overall cash flow, while offering their shoppers a friction-free payment experience at checkout.

Globally, instalments represented $1.2 trillion in payment volume in 2017 and have been growing 15 per cent year-over-year, twice as fast as credit cards.

A recent study found US cardholders think instalments are helpful for budgeting (74 per cent) and alleviating the stress of making large purchases (70 per cent). In addition, three-in-five (60 per cent) of millennials in the US said that they are interested in point of sale financing for large online purchases.

While instalments have been gaining traction in the US, they have also been a popular payment option internationally. In Brazil, an early-adopter of instalment payments, approximately 50 per cent of all credit payment volume is already on instalments. 

In Canada, 41 per cent of cardholders surveyed said they would consider using instalment payments on purchases of $500 or more.

Scheduled to be available to clients and partners in January 2020, Visa’s instalment solutions will be one of the first new payment innovations available through Visa Next. It is a new destination for accessing new solutions in the company’s product pipeline, it stated. – TradeArabia News Service




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