Visa has introduced a new API platform called Visa Next. The platform with beta application programming interfaces (APIs) and development tools for issuers and processors was launched to help build and beta test new payment products.
The APIs will allow on-demand digital payment accounts that seamlessly combine multiple digital services, with the aim of changing the way users access and manage funds.
It will also be easier to use digital tokens, with users able to activate or tokenise digital accounts for e-commerce or mobile wallets.
The first set of beta APIs enable Visa Next partners to create digital money management tools that will give issuers the ability to offer more flexible digital payment capabilities.
Integrating APIs allows issuers to:
- Create new digital card accounts on demand. They can also add newly issued or existing cards to the platform to build solutions that combine multiple Visa digital services.
- Activate tokens to enable digital accounts to be used in e-commerce and in mobile wallets. The APIs can also enable mobile devices to make contactless or QR payments.
- Share digital companion cards and control them in real time. The APIs also deliver transaction data, like purchase alerts, to clients for real-time actions or authorisation.
- Set thresholds around the digital cards by category. Users could set card controls for digital cards including turning the card on and off at any time. And limits can be set including by category like purchase channel, geography, type of merchant, or specific merchant.
The bigger picture is that Visa Next can streamline digital transactions in a number of ways — which can ease digital transactions on both the provider and consumer side.
The ability to set specific card controls could facilitate account sharing for consumers. Visa provided the example of parents instantly creating a Visa card on their children’s mobile device rather than giving them cash.
The child would be spending from the parent’s bank account or credit line, but the parent would have the ability to set specific spend controls including up to what time the child can use the card and at what specific types of merchants. This capability could “set a level of fidelity around the payment that doesn’t exist right now,” explains Sam Shrauger, SVP, global issuer and consumer solutions at Visa, in an interview.
The APIs could also enable payment platforms to accelerate their global expansion by tapping into Visa’s expansive merchant network.
Visa gave the example of “super apps,” which reach almost all aspects of a consumer’s life and are popular in Asia. These apps are typically used domestically, but Visa said its clients and partners could use the APIs to turn wallet balances from the super apps into digital Visa cards. Consumers could then spend the balance wherever Visa is accepted, allowing them to use their preferred payment method even in a country where it’s not accepted.
Though Visa didn’t point to one super app specifically, the API could benefit firms like WeChat Pay, which is an extremely popular super app in China. It’s been working to capture spending from its users while they travel globally. So far, its expansion efforts have been successful: Chinese tourists paid for 32% of transactions overseas with their phones in 2018, overtaking cash for the first time.
The upswing in mobile payments is likely because of the increased availability of WeChat Pay — and its main rival Alipay — in popular tourist destinations. WeChat Pay could speed up its expansion by using these APIs, which give it access to Visa’s network of 43.9 million merchant locations across 200 countries. That could ultimately allow WeChat Pay to boost volume without having to invest in building out its global network one market at a time.