Visa Inc. executives see the digitization of payments in India as a significant avenue for growth for the payment processor.
During a Feb. 2 earnings call, CEO Alfred Kelly Jr. said Visa sees a "large opportunity" in India's move to become an economy less dependent on cash. The government in India has incentivized consumers and merchants to move toward digital payments rather than physical currency.
In the most recent quarter in India, Kelly said Visa saw a nearly 75% increase in payment volumes and about two times more processed transactions. To build on this momentum, the company is coordinating with stakeholders in the country, Kelly said. Visa is working with issuers there to drive awareness and debit card activation and is also working with acquirers and merchants to promote digital acceptance solutions, he said.
"It is early days, but we're excited about the opportunity to expand electronic payments to consumers," he added.
Kelly also pointed out that Visa is being "fairly conservative" in its revenue expectations for India, and the market is unlikely to drive much profit for the company in the coming fiscal year.
"It's a great year for us to make sure that we do everything we can in one of the two largest-population countries in the world to get as good of a position as we can to help us over the next decade," Kelly added.
Looking ahead, CFO Vasant Prabhu pointed to the weakening Euro and strengthening U.S. dollar as headwinds. The strengthening dollar is a risk that needs to be monitored, Prabhu said. He noted that the stronger dollar turned out to be a "stiffer" headwind than expected in the fiscal 2017 first quarter. Additionally, the weaker Euro will dampen Visa Europe's results more than previously expected, he said.