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With several new products coming to the U.S. this year, the Visa payment network is working to propel consumers into a future where purses are lighter, pockets are emptier and payments are easier. Most notable among the company's plans: one "credential" that gives users the option to pay with a credit card, debit card, rewards points, or a "buy now, pay later" plan.
“No one wants a thick wallet. It’s the George Constanza problem,” says Matthew Goldman, founder of the financial technology consulting firm Totavi, referencing an episode of “Seinfeld” where one character’s overstuffed wallet causes him back pain.
If you’re one of the 48% of Americans who used a digital wallet in the past 90 days, per March 2024 data from J.D. Power, you’re already experiencing technology’s wallet-slimming potential. However, merchant acceptance is still iffy, especially when it comes to small businesses. The J.D. Power 2024 Merchant Services Satisfaction Study found that only 57% of small businesses now accept digital wallets.
Still, this has been a busy spring when it comes to digital payment innovation. Just a week after Visa announced its new suite of services, Google Pay announced the launch of new features, too. The Google Pay app will now show your cards’ benefits at checkout so you can pick the one that will earn the most rewards for the purchase (for now, this is limited to American Express or Capital One cards when checking out on the Chrome browser). You’ll also be shown buy now, pay later options for more merchants than before. Plus, you can autofill details like shipping and billing information with a fingerprint, face scan or screen lock PIN.
Visa’s launch is part of a larger trend of making it effortless to make purchases. “These innovations are all designed to streamline payment actions and make it easier and safer for consumers to transact across different environments in a more consistent manner,” said Beth Robertson, managing director at Keynova, a financial services intelligence firm, in an email.
Visa’s new services
Visa is launching several new services, some of which pertain to electronic bill payments and data security. Here are the ones with the most potential to change your shopping experience:
Visa Flexible Credential
The service that might get the most notice from anyone who carts around a card-filled wallet is Visa Flexible Credential. It allows you to access multiple payment options — including debit and credit cards, loyalty points, and buy now, pay later plans — from one payment source. You can also set some parameters, like paying with debit if a purchase is below a certain amount and paying with credit if it exceeds that amount.
Tap to Everything
You’re likely already growing more accustomed to tapping your card, as opposed to dipping it into a chip reader, as merchants update their point-of-sale (POS) terminals to access contactless payments. Tap to Everything expands upon this idea, with the promise that "any device can now be a POS device," per Visa's news release. For instance, merchants will be able to take payments by letting consumers tap their cards to the merchant’s mobile device.
That tapping process may even translate to peer-to-peer payments, allowing "money to be sent between family and friends" in a similar way, Visa's release notes.
You'll also be able to tap your card to your own phone to securely add it to a digital wallet, or to add it as a payment method on a merchant’s website.
Visa Payment Passkey Service
Instead of entering passwords or one-time security codes when shopping online, Visa Payment Passkey Service allows you to use your face or fingerprint to authorize the transaction.
What will change for consumers?
These products will begin coming to the market later this year. Some details about how they’ll work are still unclear, like which cards may be eligible to use with Visa Flexible Credential. How quickly consumers adopt new ways of paying can also come down to merchant acceptance.
“I think it’s important for leading issuers to promote options like these and to educate their customers about their value,” Robertson said. She added that merchants prominently mentioning these payment options on their own websites will make them more visible to consumers.
Ultimately, these are steps toward a future where picking the right payment method for each purchase, and authenticating those purchases so your bank knows they aren’t fraudulent, will be faster and easier than ever before. According to Robertson, we’ve already seen some of these innovations elsewhere, like credit cards that offer buy now, pay later plans for eligible purchases, and your face or fingerprint being used to initiate a payment.
As consumers and merchants more fully embrace digital wallets, innovations that reduce friction during the checkout process will continue to come to the market.
“I think the physical form factor of the card is going to go away,” Goldman says. “We’ll still call them cards, I suppose.”
