Visa has achieved a major milestone in the Asia-Pacific region, surpassing 1 billion tokens used in its payment services. This success has resulted in a market uplift of over $2 billion in the past year. The Visa Token Service (VST), introduced in 2014, acts as a bridge between traditional banking and digital payment platforms like Google Pay and Apple Pay.
VST replaces the conventional 16-digit credit/debit card number with a secure numeric token, enabling consumers to share financial information without compromising their personal details or bank account information. Operating on VisaNet, the company’s proprietary network, VST has the capability to handle more than 56,000 transaction messages per second.
The tokenization of payment methods has proven particularly beneficial for cross-border payments and international travel. Traditional methods such as cash exchange and wire transfers often involve various complications. By using tokenized assets like cryptocurrencies or tokenized payment services such as VST, many of these transaction challenges can be avoided.
A recent study conducted by Visa revealed that 97% of travelers in the Asia-Pacific region prefer non-cash payment options. In 2023, this preference resulted in an average expenditure of $2,525 per trip. As the world recovers from the COVID-19 pandemic, the demand for international payment methods with low fees and friction has become a significant factor influencing consumer purchasing behavior.
TR Ramachandran, Visa’s head of products and solutions for the Asia-Pacific region, stated in a press release that tokens are leading the way for the future of commerce. Previn Pillay, head of merchant sales and acquiring for Asia Pacific at Visa, encouraged more merchants to adopt tokenized payments, noting that this technology can directly impact their financial performance.
In related news, Visa and Mastercard are expected to play a crucial role in driving the adoption of cryptocurrencies in the coming year.