Visa at JP Morgan Conference Notes

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Charles Scharf – Chief Executive Officer

The environment continues to be more of the same of what we saw last quarter, not weakness but not strength either

“Listen I think – I guess what we are seeing and you can take this as good or bad, but it’s very much more of the same. The 8-K that we put out had updated volumes for the month of April which when you look at where we were last quarter and just for the leap year the numbers are basically right on where we’ve been running. So, on the one hand you look at it and say listen given what a lot of retailers are reporting especially here in the United States, is there a fear of a weakening environment. We don’t see that weakening environment, but in the same respect we also don’t see a strengthening of commerce and obviously that’s something that we’d like to see. But I would say in every developed market around the world volumes continue to perform at levels like we saw last quarter.”

Banks understand the importance of preserving their role as a payments provider

“the banks all across the world clearly in my mind understand the importance of doing everything they can to preserve that their role as the primary payments provider and we in the other significant established networks out there provide the best way for them to continue to do that.”

The chip eliminates fraud

“The heart of it it’s not really complicated. The heart of it when you look at the card-present fraud over 80% of the card-present fraud is eliminated just by having a chip card at a chip accepting terminal. It’s the chip. That’s what eliminates the majority of the fraud, because the chip cannot be duplicated as opposed to a magstripe, which is very easily duplicated. So you can capture the magstripe information either physically or by electronically getting into people’s files, very easy to duplicate magstripe cards they can then get used all places where magstripe cards are accepted. The chip produces a one-time cryptographic. It is a real computer chip and it hasn’t been duplicated yet. And so the best thing that we can do to eliminate fraud in the country is to get chip cards and chip readers out there.”

Blockchain is something we spend a lot of time thinking about. Right now we think it will just force us to make sure that our costs are as low as possible

“Listen, blockchain is it something I think that from our standpoint we certainly spend a lot of time thinking about and we have our own investments in companies where we’re developing prototypes that are based on blockchain technology for things. I think if you just ask me what the impact will be I think the short-term on payments not tremendously significant because the blockchain technology I think is most applicable where you can get very quick wins at bringing transactions in a way which there’s clear ownership, where it’s public, where it’s reasonably priced and it’s very, very fast and we have that in the payments environment today. Over a period of time does it become a tool to help drive, force people to drive the underlying infrastructure cost down absolutely. And so I think from our standpoint, we need to know that there is technology out there, which with all of its flaws, while it’s certainly not free, because there a lot of embedded costs when you’ve got to do the things that you have to do to run a payments network. It will force us to make sure that we’re doing everything we can to drive our infrastructure cost down.”