Visa and Mastercard have both published their calendar Q3 2021 earnings results (which for Visa is Q4 2021) – and while both companies are reporting a near full return to pre-pandemic levels for cross-border volume, travel remains a hindrance. 

Mastercard Q3 2021 results

• Overall cross-border volumes are now at 105% of 2019 levels as a result of improvements in consumer and commercial travel, as well as ongoing cross-border card-not-present (ecommerce). Cross-border volume grew by 52%, while cross-border volume fees grew by 59%. 
• However there remains “significant room for growth” in cross-border travel. The opening of travel corridors, particularly US inbound, as well as easing restrictions in Asia, is nevertheless helping, with Mastercard’s cross-border travel volumes now at 72% of 2019 levels, compared to 48% in Q2. The company declined to predict when a full return would occur, but CFO Sachin Mehra said they “remain optimistic” and argued that “if people can travel, they will travel”.
• Elsewhere, the focus continues to be on driving the shift to digital, including through recently announced BNPL offering Mastercard Instalments, which allows BNPL to be offered to consumers without merchant integration.
• The company has also seen some wins in its Mastercard Send offering, with PayPal using the platform for P2P transactions and wallet cash-outs.
• In crypto, Mastercard is making continuing efforts to connect crypto players to its network, with several new crypto wallet providers and exchanges announced in Q3, and a crypto program to make it easier for consumers to buy, spend and earn rewards with crypto.
• Overall quarterly revenue grew 29% year-on-year to $5bn, and Mastercard expects net revenues to grow in the low 20s in Q4.

Visa Q4 2021 results

• Visa saw record total global payments volume, at $4.8tn, with cross-border now closing in on pre-pandemic levels. 
• Cross-border volume excluding intra Europe was 86% of 2019 in the quarter and saw a 46% jump year-on-year.  Ecommerce (cross-border card-not-present) remains the strongest, at 43% above 2019. Visa now expects cross-border volumes to fully return over next two years.
• In consumer payments, the digitisation trend has continued. In FY 21, Visa saw a 23% increase in debit payments volume, compared to 4% increase in cash withdrawals.
• Visa Direct also grew its global reach, with a 35% increase in transactions in Q4 – a smaller increase than the 50%+ climbs of the past few quarters, but still notable given it compares to a very strong quarter where Visa Direct hit 1 billion+ transactions for the first time. Visa processed over 5 billion transactions across almost 550 enablers in FY 21, with around 120 million cards in the US alone sending or receiving funds using Visa Direct.
• The company plans to continue growing Visa Direct through a mix of cross-border P2P and other payments, as well as scaling in new markets. This includes adding Paysend in the latest quarter, as well as adding cross-border P2P for US-based Western Union customers sending to key markets. Ultimately the company sees a market opportunity totalling $65tn for Visa Direct.
• On the crypto side, Visa has continued to expand its crypto APIs and services, and now has almost 60 crypto platform partners with Visa credential issuance capabilities. It captured $3.5bn+ crypto payment volume in FY 21. 
• In BNPL, meanwhile, Visa acknowledges it only has a “fraction of the industry’s total payment volume” but is focusing on providing a network solution (by adding instalment options to existing cards) and working with BNPL fintech partners to help scale.
• Overall quarterly revenue grew by 29% year-on-year to $6.6bn in the latest quarter, and 10% to $24.1bn in FY 2021. For FY 2022, Visa expects to see mid-teens growth. 

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Lucy Ingham

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Lucy is Head of Content & Editor-in-Chief at FXC Intelligence, overseeing all content and taking deep dives into the trends and data driving changes in payments. Before joining FXC Intelligence, Lucy worked as a technology journalist and editor, interviewing CEOs and major names across enterprise technology, including fintech. She has an MSc in Development Anthropology from Durham University.