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Why Visa Sees the US Market as Profitable

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Targeting smaller merchants, transactions

At the J.P. Morgan Global Technology, Media and Communications Conference, Visa (V) stated it would be targeting the US market’s significant untapped opportunities, which could boost growth. By targeting small merchants and increasing its merchant base, the company could see long-term growth.

Visa also stated that focusing on smaller transactions could grow its market share. Smaller merchants may not be aware of cheaper digital methods available, resorting to cash payments. Therefore, Visa is focusing on making merchants and consumers aware of the digital payment techniques available.

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Digital payments could be a primary driver

According to Visa, US contactless payments might rise with e-commerce. If US consumers become well-versed with e-commerce, they might be prompted to make digital transactions. The company believes the B2B (business-to-business) payment industry offers significant global growth opportunities.

In February, Visa announced its acquisition of Fraedom, which could enable Visa to serve B2B clients more effectively. On May 22, Visa’s EV (enterprise value) was $300 billion, while peers (XLF) Mastercard (MA), Ally Financial (ALLY), and Discover Financial Services (DFS) had EVs of $197.2 billion, $64.0 billion, and $35.6 billion, respectively.

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