Friday, March 13th, 2015

Social Media Have Become The New Frontier For Credit Card Marketing

Tags: credit card statistics, infographics

Social Media Have Become The New Frontier For Credit Card Marketing


The guys over at CardHub.com have looked at a lot of data to see how the latest credit card trends are affecting millennials and have come up with some interesting findings.


Noting that the days that credit card companies used tables on campuses as mobile college student recruiting stations are gone with the passage of the CARD Act, CardHub.com observes that college kids are still a prized demographic.


As the CARD Act does not restrict credit card companies from promoting themselves online, CardHub.com finds, social media have become the new frontier for credit card marketing. The authors have presented their findings in the fun and useful infographic below.

Social Media Have Become The New Frontier For Credit Card Marketing


Credit Cards Go Social and Why You Should Care


Source: CardHub.com.

Friday, March 14th, 2014

How We Use Our Credit Cards

Tags: credit card statistics, infographics

How We Use Our Credit Cards


We love infographics here at UniBul, even though we rarely muster the commitment to produce one ourselves. The way we see it, why should we invest the time and money to do that when so many people are doing it much better than we ever could? Instead, we prefer to stick to what we (believe) are good at — analyzing the latest events and trends in our industry, offering advice and insider knowledge on payment processing issues and, occasionally, having fun with some industry participant or other (after all, as Jane Austen once observed, “what do we live for, but to make sport for our neighbors and laugh at them in our turn“).


And so the latest infographic that caught my attention comes to us courtesy of the good people over at The Credit Examiner. It visualizes the current state of consumer credit cards in the U.S. and provides statistics on things like the number of cards in circulation, purchase volume, market shares of the biggest card networks, etc. It is well done and researched and I thought I should share it with you. Here it is.

How Americans Are Using Their Credit Cards


Before I show you the graph, let’s run through the main statistics, as gathered for us by The Credit Examiner. Here are the authors’ top-line numbers:


1. Estimated number of credit cardholders in the U.S. — 181 million.


2. Estimated number of credit cards in the U.S. — 609.8 million.


3. A third of Americans do not have a credit card.


4. Total annual purchase volume of U.S. credit cards in 2011 — $2,050 billion. Here is how that volume breaks down among the four largest U.S. card networks:



Credit Cards

Purchase Volume, in Billion

Number of U.S. Credit Cards, in Million

Visa

$888.00

234.1

American Express

$540.14

50.6

MasterCard

$508.00

175.7

Discover

$114.15

58.7


5. Average age at which a U.S. consumer gets his / her first credit card — 20.8 years.


6. 84 percent of U.S. students have credit cards.


7. Average number of credit cards per consumer — 4.4. One in ten Americans has more than 10 credit cards. It turns out that, the more credit cards a consumer has, the more likely she is to use it, as seen in the table below:



Credit Card Usage

Number of Credit Cards

Regularly use

1.9

Rarely use

1.6

Never use

1.0


8. Credit card point-of-sale (POS) purchases are expected to grow from 29 percent to 33 percent by 2017. Cash POS purchases, on the other hand, are expected to drop from 27 percent to 23 percent by 2017.


9. 54 percent of American cardholders pay their balance in full each month, 33 percent carry balances up to $10,000 from month to month and 13 percent carry balances over $10,000.


10. The biggest item for which Americans pay with their credit cards is travel expenses. Here is the complete list:



Expense Item

Share of Cardholders Paying for It with a Credit Card

Travel expenses

81%

Expensive purchases

77%

Personal items

46%

Eating / dining out

44%

Grocery

38%

Entertainment

37%

Household bills

20%

Small expenses

15%


11. Two-thirds of U.S. cardholders would consider switching their primary credit card if better features were offered.


12. No annual fee is the most sought-after credit card feature. Here is the full list:



Feature

Share of Cardholders Seeking for It

No annual fee

73%

Low interest rates

47%

Reward points

46%

Bonus / exclusive deals

41%

Introductory reward points

38%

Unlimited cash back

30%

Airline miles

20%

Zero liability on unauthorized purchases

19%

Discounted retails partnerships

10%


Now here is the infographic itself:


How We Use Our Credit Cards


Image credit: TheCreditExaminer.com.

Monday, February 10th, 2014

Why Do You Get Credit Card Offers?

Tags: credit card statistics

Why Do You Get Credit Card Offers?


That is the question Daniel Grodzicki, an economist at Stanford University, has tackled in a new paper. The author begins by confirming a rather self-evident fact — the issuers’ offer decisions reflect customer poaching via rewards, introductory rates, and balance transfer programs — but he also makes some far less obvious, even counterintuitive, findings. For one, Grodzicki finds that an increase in the cost of funds has a greater effect on the quantity of offers sent than on the pricing of these offers to consumers.


Furthermore, it turns out that the costs of sending these offers has a greater effect on the number of offers individuals receive than does the level of competition among issuers. So, a reduction in the sending costs would increase the number of offers individuals receive relatively more than adding an additional market participant.


The author also gives us some interesting data on the distribution of credit card offers among the U.S. issuers — the market is dominated by the six biggest issuers — as well as some historical perspective on how the U.S. credit card market has evolved. It is truly amazing just how much has changed in the credit card world over the past three decades, with information technology being the main driving force, and it makes one wonder how great of an effect recent regulation and the rise of big data will have in the years to come. Let’s take a look at Grodzicki’s paper.

Where Did We Come From?


Grodzicki’s description of the 1980’s U.S. credit card landscape might sound a bit alien to many of you:

The credit card market of the 1980s was large and unconcentrated, and competing lenders faced few barriers to entry or doing business across state lines. Still, the market was, by several measures, uncompetitive: markups were high, prices were unresponsive to underlying cost, and lenders earned three to five times the ordinary rate of return in banking (Ausubel, 1991). During this period, applicants’ credit worthiness was assessed using simple metrics like debt to income ratios.6 There was little variation across banks in the information and methods used to screen customers. As a result, the credit card was a homogeneous product. There… were few differences in rates and fee structures; annual fees were meant to compensate the lender for expenses associated with usage.7 Cards did not generally offer special introductory or balance transfer offers, bundled insurance products, or rewards.


Then in the 1990s, the issuers’ embrace of information technology brought about change. Banks could now more easily acquire and assess information on prospective customers, which “placed significant competitive pressure on the industry”. As a result, prices fell and profitability declined, but credit became available to a broader range of consumers. In turn, easier access to credit made it more difficult for issuers to hold on to their existing customers. There had to be a response and there was:

[B]anks offered more products with low introductory teaser rates and balance transfer features. To further incentivize consumers, cards offered rewards programs, like cash back and frequent flier miles, as well as bundled insurance products. Special rate offers and rewards served a dual purpose. On the one hand they provided extra incentives to potential new customers. On the other hand they made the credit card a more heterogeneous good.

With more information on potential borrowers, lenders could better assess what types of cards specific consumers most liked, as well as how profitable these consumers were likely to be as holders of such cards. Consequently, there was a sharp rise in the variety of products offered in the market. As lenders could better target their products to individual prospective borrowers, the resulting set of offers any given consumers might consider became highly customized.


The upshot was that:

Today’s credit card market is larger than before, concentrated, and more competitive.

Whereas before the main decision in credit card lending was whether or not to extend credit to a new customer, lenders now hold a varied line of complex products from which they choose to offer cards to a heterogeneous consumer population. Moreover, large lenders now maintain and constantly update enormous amounts of information on potential borrowers. They analyze this information using sophisticated and proprietary behavioral credit scoring models to determine pre-screening and account marketing, pricing, account management, estimating losses from default, and predicting the profitability of individual accounts.



Who Sends Credit Card Offers and How Many Do We Get?


The U.S. credit card market is heavily concentrated — a fact that is, as Grodzicki points out, evident when you look at direct mail offers. The six biggest U.S. lenders account for more than 94 percent of all credit card offers sent between Jan 2010 and July 2012. Moreover, as you can see in the figure below, Citibank and Chase account for close to 60 percent of all mailings.


Who Sends Credit Card Offers and How Many Do We Get?


Grodzicki then gives us the results of a survey, according to which slightly more than half of all Americans (53.3 percent) do not receive any offers in a given month and about a quarter (26.3 percent) receive one offer. Here is the full distribution:


Who Sends Credit Card Offers and How Many Do We Get?

What Do We Look for in Our Cards?


Grodzicki then proceeds to calculate Americans’ sensitivity to both the regular interest rate and the length of the introductory rate offer. He finds that an increase of one percent in the regular interest rate reduces consumer take-up by about 75 percent and a “unit improvement” in the introductory rate offer increases take-up by 69 percent.


However, consumers are found to be relatively less sensitive to the length of the balance transfer offer than they are to whether the card includes fees on balance transfers. Counterintuitively, increasing the length of a balance transfer offer reduces take-up by 24 percent, while, as would be expected, including fees on balance transfers reduces take-up — by 73 percent. These results suggest to the author that consumers look for new cards to immediately transfer their existing balances.


Grodzicki finds American consumers to be far less sensitive to other fees than they are to balance transfer fees. For example, including fees on foreign currency transactions and / or annual fees reduces consumer take-up by less than half that of including balance transfer fees. Similar is the treatment of delinquency fees. However, bundled insurance offers and rewards products are found to be “very salient to consumers”.

The Takeaway


To analyze the effects of changes in the market environment on the number of offers received by consumers and their take-up, the author considers three counterfactual scenarios: rise in the cost of funds, reduction in mail-out costs and adding a competitor. His findings:

These have shown that there is a stronger competitive effect to reducing the cost of mailing offers than to adding market participants. That is to say that market frictions, such as cost of informing consumers of offers, are more important in curbing competition than the limited number of competitors. Lastly, increasing the cost of funding credit cards has a stronger short term effect on the propensity of lenders to send offers than on the quality of those offers sent. This is due largely to the importance of incumbency in getting potential customers to take up new cards. Nevertheless, I estimate a modest increase in the average rate on the best offer received by consumers, implying some degree of pass through by banks.


So, whereas an increase in the banks’ funding rates has, at most, a negligible effect on consumer pricing, it has a measurable negative impact on the number of offers they mail out. In other words, when their own cost of borrowing increases, the issuers respond by tightening their underwriting standards, so that only the most creditworthy consumers receive an offer, and cutting their profit margins.


I guess that makes perfect sense to me. The alternative — raising interest rates in lockstep with the rise in the funding rates — would lead to higher rates of charge-offs and evidently the issuers have calculated that such a scenario would be far less profitable than the one they have chosen to go with. It’s a numbers game.


Image credit: Flickr / rubenerd.

Wednesday, February 5th, 2014

How Many Credit Cards Do You Use?

Tags: credit card statistics, Federal Reserve

How Many Credit Cards Do You Use?


In a newly-released paper, Oz Shy from the Federal Reserve Bank of Boston looks into how Americans allocate their spending among the three types of payment cards — debit, credit and prepaid — and attempts to explain what drives their decisions. He finds that consumers tend to concentrate the majority of their transactions and a large value of their card spending on a single type of card, a type of behavior known as “single-homing on a card type”.


The researcher also investigates whether consumers focus their spending on one of the card networks — Visa, MasterCard, American Express and Discover — a behavior known as “single-homing on a card network”. Once again, he finds that the majority of consumers’ transactions and spending are concentrated on a single network.


Why does “homing” matters? Well, as Shy says, his investigation gives us interesting insights into the consumers’ payment decision process. The decision to “home” on a single card type may be related to consumers’ preferences regarding particular attributes, associated with the different card types.


Debit cards, for example, offer a fast settlement of transactions, with funds immediately debited from the cardholder’s bank account, thus preventing overspending. Credit cards, in contrast, offer spending flexibility, in the sense that the cardholder may spend money she doesn’t have available today and settle the transaction at the end of the monthly cycle or even later. Prepaid cards differ from the other two types in that they are pre-funded, which, similarly to debit cards, precludes the possibility that the cardholder would spend money she hasn’t uploaded onto her card (money she doesn’t have).


And, as the author notes, while the aggregate data show that the three types of cards are substitutes, his research shows that the degree of substitution at the individual level is low, because an individual consumer tends to “single-home” on one particular card type — the one whose attributes she prefers. Let’s take a look at the paper.

Homing on a Card Type


Shy begins by looking into consumer spending preferences among card types when the primary card is defined by transaction volume. For example, a debit card would be a consumer’s primary card is by transaction volume if the number of transactions she makes with this card is greater than or equal to the number of transactions she makes with either of the other two types of card (credit or prepaid). The author finds that, on average:

  • Consumers concentrate 91 to 92.3 percent of their transactions on their primary card type.
  • Consumers whose primary card type is either debit or credit place the smallest share of transactions on prepaid cards (2 to 2.7 percent).
  • Consumers whose primary card type is prepaid place a slightly higher share of transactions on debit cards than on credit cards (4.4 percent versus 3.8 percent).


Homing on a Card Type


The right panel of the above figure shows the average transaction values for the respondents’ primary cards, which, the author suggests, may explain why some card users choose to allocate some of their spending to their non-primary cards. We learn that, on average:

  • Primary debit card users place higher-valued transactions on credit cards ($71.57 on credit versus $44.40 on debit).
  • Primary credit card users place slightly lower-valued transactions on debit cards ($42.38 on debit versus $53.93 on credit).
  • Primary prepaid card users place higher-valued transactions on debit and credit cards ($28.55 on debit and $38.47 on credit versus $24.58 on prepaid).


So, regardless of a consumer’s primary card type, all consumer groups, on average, use credit for their highest-value transactions, debit for their their mid-value transactions and prepaid for their lowest-value transactions. The author suggests that this may be because consumers prefer not to be charged immediately for high-valued transactions, but prefer to be charged immediately for small transactions.


Then the author looks into the share of transactions his respondents concentrated on their primary card type. He finds that:

  • 76.6 percent of respondents whose primary card is debit concentrated all their transactions on debit cards (and none on any other card).
  • 81.5 percent of respondents whose primary card is credit concentrated all their transactions on credit cards.
  • 86.3-percent of respondents whose primary card is prepaid concentrated all their transactions on prepaid cards.


So the majority (around 80 percent) of card users concentrated all of their transactions on their primary card.


But what happens when the primary card is defined by transaction value? A credit card would be a consumer’s primary card by value if she spends a higher dollar value using credit cards than using debit and a greater or equal amount than prepaid. The researcher finds that, on average:

  • Consumers concentrate 84.1 to 92.6 percent of their transactions on their primary card type.
  • Consumers whose primary card type is either debit or credit place the smallest share of transactions on prepaid cards (1.6 to 3.1 percent).
  • Consumers whose primary card type is prepaid place a higher share of transactions on debit cards than on credit cards (14.3 percent versus 1.6 percent).


Homing on a Card Type


So consumers tend to concentrate their spending on their primary card, regardless of whether the primary card is determined by volume or by value.


The right panel of the above figure shows that the average credit transaction value of consumers whose primary card by value is credit is $57.19 — more than twice the $25.86 average transaction value they place on their debit card. This shows that heavy credit card users use debit for low-value transactions. In contrast, consumers whose primary card is debit, place on average $46.10 on debit — only 18 percent higher than the average value they place on their non-primary credit cards ($38.75).

Homing on a Card Network


Visa is the dominant card network, both by volume and value (with about 70 percent), followed by MasterCard (with about 20 percent). However, the researcher shows that network concentration is not correlated with consumers’ tendency to concentrate their spending on a single card from a particular network.


As seen in the figure below, consumers whose primary debit network is Visa concentrate 95.2 percent of their transactions on Visa cards, on average. The corresponding average for MasterCard is practically the same — 95.8 percent. Respondents who reported that their primary debit card is “no logo” concentrated 100 percent of their transaction on no logo cards.


Homing on a Card Network


As seen in the figure below, consumers whose primary credit network is Visa place 88.5 percent of their transactions on Visa cards. on average. The corresponding average for MasterCard is, once again, practically the same — 87.8 percent. This time we also have averages for Discover — 89.3 percent and American Express — 86.5, which also are very close to the bigger networks’ averages.


Homing on a Card Network


Finally, as the figure below shows, primary prepaid card users concentrate 95 to 100 percent of their transactions on their primary network, on average.


Homing on a Card Network


Overall, 92 to 100 percent of debit and prepaid users single-homed on a particular card network. However, single-homing is slightly lower for credit card users, where 78 to 92 percent of the respondents single-homed on one network.

The Takeaway


So the paper provides confirmation that most consumers concentrate their card payments on a single card type. Here is how the author interprets his findings:

One might conjecture that this is because the type they use most or exclusively has a consumers’ most preferred set of attributes. It is also possible that the choice is arbitrary with respect to attributes but made because consumers find it more convenient to use a single card or card type or network. In contrast, consumers who multi-home with respect to card types are probably those who gain from being able to choose from a variety of attributes (preference for variety). Multi-homing behavior may imply that consumers do not view the three card types as perfect substitutes because of the different functions and attributes that are unique to a card type.


For my part, I am not at all surprised that consumers do not see the three card types as perfect substitutes. After all, these are three very different payment instruments; otherwise, why bother having them all in the first place? But this point goes deeper than that. For example, we keep being told that credit cards are about to go extinct any day now, to be replaced by some “new-age” service or other. Let’s leave aside the fact that, way too often, these new payment platforms have credit cards as a funding method at their core. The point is that, even if you introduced some completely new and infinitely convenient payment method, it would still have a hard time outcompeting the traditional payment types, simply because each of them meets a particular consumer need.


Image credit: Flickr / mangpages (changes have been made to the original image).

Thursday, January 30th, 2014

Developing Markets Continue to Drive Global Non-Cash Payments Growth

Tags: credit card statistics, infographics, mobile payments

Developing Markets Continue to Drive Global Non-Cash Payments Growth


Payments markets in North America and Europe remain the largest non-cash payments markets in the world, but the growth rate in developing markets is more than three times as high, we learn from the latest World Payments Report from Capgemini—a big French consulting company. Together, the mature markets accounted for more than three-quarters of the global non-cash transaction volumes in 2011, we learn. However, whereas the developed world’s volumes grew at rates in the mid-single digits, the Central Europe, Middle East, Africa (CEMEA) and Emerging Asia regions each grew by more than a fifth, even as each of these markets displayed unique payments preferences.


The use of credit and debit cards each grew in double digits and these two payment types continue to lead in the non-cash payment segment by quite a margin. Furthermore, the researchers tell us, the credit card transaction volume’s growth rate rebounded in 2011 in the U.S., helped by improving economy and consumer sentiment. Mobile payments are growing fast and their growth rate is expected to remain high in the coming years. However, the rise of m-payments may actually help the two leading payment instruments further increase their shares of the market.


Debit cards in particular are set to take advantage of the fast adoption of m-payments and to continue taking more market share away from other payment instruments, such as cash and checks. Moreover, that trend is likely to accelerate as consumers around the world continue to increase their use of mobile payments and choose to settle these transactions through their debit cards (as many of them are already doing). The same is true for credit cards, especially in developed markets. And this is a point that often escapes many observers: mobile payments are not a substitute to traditional payment methods, but are primarily an extension of them. In other words, m-payments are not about to do away with credit cards, but are promoting them. Let’s take a look at Capgemini’ data.

Emerging Markets Lead the Way


The global volume of non-cash payments continues to grow steadily and the largest gains continue to be taking place in developing markets. Worldwide, non-cash payments volumes increased by 8.8 percent to reach 307 billion transactions in 2011, up from 7.1 percent and 283 billion, respectively, in 2010. Mature markets made up 77 percent of the total volume, but their combined growth rate—6.2 percent—was three times lower than the 18.7-percent growth rate of the developing markets.


Emerging Markets Lead the Way


As already noted, much of the growth in the developing world was driven by Emerging Asia and Central Europe, Middle East and Africa (CEMEA). While these regions still have a low share of the global total of non-cash transactions, investments in payments services and infrastructure are helping them to grow significantly, we learn. Emerging Asia, with a 6.5-percent share of the global market, grew by 22.1 percent during 2011. CEMEA, with a slightly higher share of 6.9 percent, grew by 21.9 percent.


Within those regions, China and Ukraine grew by more than 30 percent each in 2011, with payment cards being the fastest growing non-cash instrument, as has been the case in most markets. In Latin America, which accounts for 9.5 percent of the global total, the growth rate was 14.4 percent. The strong performer in this region was, once again, Brazil, which contributed more than 70 percent to the total volume of non-cash transactions in the region for the year, which is mostly due to an increased use of payments cards. The use of debit cards in Brazil in 2011 rose by 23.1 percent and the use of credit cards was up by 16.3 percent.


In the developed markets, mature Asia-Pacific countries recorded the strongest growth—from a market share of 9.8 percent, their transaction volumes grew by 11 percent. Within the region, South Korea was the top performer with a growth rate of 12.2 percent, with payment cards being the primary growth driver. Japan’s rate of growth was 11.6 percent, driven to a large degree by the growing popularity of e-wallets, which are based on credit cards.


The North American market has a global market share of 40.4 percent, Capgemini tells us. The number of non-cash transactions increased by 6.6 percent to 114.2 billion in the U.S. and by 4.3 percent to 9.8 billion in Canada.


In Europe, which in 2011 had a 26.8-percent share of total global volume, the picture was much more varied. Growth occurred in non-euro countries such as Poland, where volumes rose by 14.6 percent, the U.K.—7.6 percent—and Denmark—7.6 percent. In the Eurozone, Finland grew by 10 percent, but crisis-stricken Spain and Ireland saw non-cash volumes fall by 1 percent and 0.8 percent, respectively.

The Developed World Is still Ahead


In absolute numbers, developed markets are still leading by a wide margin. At 405 per person, Finland had the highest number of non-cash transactions in 2011, followed by the U.S. at 367. In Finland’s case, we have a market exceeding 400 non-cash transactions per person for the first time ever. Here is a chart of the top 10 regions:


The Developed World Is still Ahead

Payment Cards Drive E-Payment Growth


In 2011, payment cards continued to take market share away from every other non-cash instrument, in every region. Credit card transaction volumes grew by 12.3 percent globally, while debit card volumes rose by 15.8 percent. North America is by far the leader in this category, with 65 percent of non-cash transactions made by a payment card, with checks falling to 18 percent, direct debits adding 10 percent and credit transfers—7 percent. In Europe, cards made up 41 percent of non-cash transactions, followed by credit transfers at 27 percent, direct debits at 26 percent and checks at 5 percent. Here is a comparison chart of the non-cash transactions and the mix of payment instruments, by region:


Payment Cards Drive E-Payment Growth

E-Commerce and Mobile Payments Are Growing Fast


As there is no commonly accepted definition of e-payments, the researchers are using e-commerce as a proxy. The authors expect the e-commerce market to grow by 18.1 percent annually from 2010, when the transaction total was 17.9 billion, until 2014, when the estimated total is 34.8 billion and the transaction value—$1,792.4 billion.


The global mobile payments market continues to grow rapidly, powered by innovation and demand, the report tells us. The global m-payments value reached $256 billion in 2012 and is expected to grow three-fold to a total of $796 billion in 2014. P2P mobile payments in developing markets and C2B m-payments in developed markets are the main drivers of growth, we learn. The number of mobile payment users is expected to exceed 212 million globally in 2012—a 32 percent increase over 2011’s figure.


Here is a chart showing the expected increases in e-commerce and m-payment transactions between 2010 and 2014:


E-Commerce-and-Mobile-Payments-Are-Growing-Fast

Prepaid Cards Are Growing Incredibly Fast


Along with e- and m-payments, the prepaid cards market is one of the fastest growing non-cash payments markets, with most of the growth coming from the U.S., we learn. The global transaction volumes of open-loop prepaid cards—cards bearing the logo of a payment network like Visa or MasterCard, which can be used anywhere— have grown by more than 20 percent over the past four years and are expected to reach 16.9 billion annually in 2014—an enormous growth.


Prepaid Cards Are Growing Incredibly Fast

The Takeaway


So cash continues to be squeezed out of the global economy and the Capgemini report shows that the main drivers of the trend are developing countries. Here is the authors’ conclusion:

Global non-cash payments transactions continued to accelerate during 2011 and early indicators suggest 2012 will be no different. A slowdown in non-cash transactions in many recession hit economies was in contrast to the world’s growth economies, such as China. Several of the developed economies such as the U.S., as it emerges from the financial crisis, and the U.K. and others with strong payment industries are continuing to grow at a faster rate. Going forward, this growth will be further enabled by opportunities in new markets, such as Africa, and in new instruments, including prepaid cards, and e- and m-payments. Hence there is enormous opportunity for those players looking to make investments in the payments market, and provide innovative offerings. There are areas for growth in both emerging and mature markets, as well as in new instruments.


Growth levels in the non-cash payments market have been particularly high in areas where the regulatory challenge is not too onerous, or there is a comparative lack of regulation. The lack of regulation may have helped the growth of such instruments, but increasingly is likely to pose an issue with regards to quality of reported data and risk management. It will be interesting to see how the regulatory environment evolves for these new and innovative instruments.


Image credit: Visa.