Online spending in the U.S. on Visa-branded credit and debit cards rose 59% year-over-year in the first quarter, to $22.3 billion from $14.03 billion, Visa says.
The first-quarter spending is outpacing the full-year increase recorded last year, when online spending on Visa cards rose 53% over 2002, to $60.4 billion from $39.4 billion, Visa says. The number of e-commerce transactions on Visa cards last year grew 44.5%, to 722 million from 500 million in 2002. Visa factors in all e-commerce sales, including travel, events tickets and recurring utility payments.
Visa attributes the first-quarter increase partly to growth of its Verified by Visa program, which requires consumers to enter a personal identification number when using a Visa card to make an online purchase. More than 9,000 issuers of Visa cards worldwide offer the Verified by Visa program, which is also supported by more than 17,000 merchants, Visa says. Merchants who participate in the program, which requires the installation of software to process the personal identification number, are not liable for fraud-related chargebacks on consumer transactions.
Visa also offers a 5-basis-point discount on interchange reimbursement fees, applied between the merchant’s bank and the cardholder’s bank, for all Verified by Visa transactions. Actual transaction pricing to merchants, including any discounts, is determined by the merchant’s acquiring bank, Visa says.