Visa made an announcement on March 26, revealing that its payment services in the Asia-Pacific region have successfully processed over 1 billion tokens. These services have also generated a market uplift of more than $2 billion in the past year.
The Visa Token Service (VST) was launched in 2014 and acts as a connection between traditional banking accounts and digital payment platforms such as Google Pay and Apple Pay. Essentially, VST replaces the conventional 16-digit credit/debit card number with a secure numeric token, allowing consumers to share financial information without exposing their private details or banking information.
VST operates on VisaNet, the company’s exclusive network that has the capability to handle more than 56,000 transaction messages per second, as stated in official company documentation.
Tokenized payment methods, like VST, are commonly used for cross-border payments and international travel. These methods help to eliminate the numerous difficulties associated with exchanging cash or conducting wire transfers across different currencies. By utilizing tokenized assets, such as cryptocurrencies, or tokenized payment services like VST, much of the hassle involved in these transactions can be avoided.
According to a recent study conducted by Visa, 97% of travelers in the Asia-Pacific region prefer to make payments using non-cash methods. This led to an average expenditure of $2,525 per trip in 2023.
Since the outbreak of COVID-19, there has been a significant increase in the tokenization of traditional assets into digital currencies and payment facilitators. As global travel continues to rebound after the pandemic, consumers are increasingly seeking international payment methods with low fees and minimal friction when making purchases.
TR Ramachandran, Visa’s head of products and solutions for the Asia-Pacific region, expressed in a press release that tokens are paving the way for the future of commerce. Previn Pillay, head of merchant sales and acquiring for Asia Pacific at Visa, also encouraged more merchants to adopt tokenized payments, highlighting the direct impact this technology can have on their financial performance.
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