Visa Secures eCommerce - Analyst Blog

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Yesterday, Visa Inc. ( V ) announced the launch of a new service - Visa Consumer Authentication Service - to mitigate the risk of fraud related to the eCommerce transactions in Canada.

Accordingly, the new authentication service will dynamically support a secure payment process through a new feature - Three Domain (3-D) Secure program. This new 3-D feature will enhance the level of security Visa takes while the consumer makes its payment and checks out of the terminal.

Presently, the new service does not require customers to go through the hassle of entering passwords for verification. The 3-D feature automatically assesses the authenticity of a particular transaction by the historical trend of the consumer's expenditure. It also detects the device from which the transaction is made and relays all information regarding it, thereby making the service useful for mobile payments.


Authenticated payment services are a critical requirement at this moment since the card industry solely operates on chip cards that hold all the customer information. These cards interchange various hands, such as retailer, merchant and acquirer, before reaching the ultimate source.

Visa has been consistently aiming to achieve high data security in order to maintain a strict security protocol, thereby adding an easy and reliant defense mechanism in to the payment system. This also ensures the long-term growth opportunity for eCommerce. To deliver a higher level of card data security to acquirers and merchants, the company unveiled an upgraded data security service - Visa Merchant Data Secure - in August this year.

The company aims to retain its strength by exploring newer growth avenues, besides expanding into emerging international markets to support growth. Moreover, the regulatory challenges have diverted Visa's synergies to the rapidly growing prepaid cards, money transfer services, eCommerce and mobile banking in order to reach out even to the small businesses, thereby helping them to increase profitability and cash flow by initiating controlled spending with convenience. Hence, to meet these growth strategies, Visa needed a critical data safety and control system in order.

Overall, Visa is making vigorous attempts to augment its core processing capabilities and maintain its competitive position, primarily against its arch rivals - MasterCard Inc. ( MA ) and American Express Co. ( AXP ) -in an increasingly complex payments environment, primarily through the strategic technology acquisitions and product innovations.

Visa currently retains a Zacks #2 Rank, which translates into a short-term Buy rating, while the long-term recommendation remains Neutral.



AMER EXPRESS CO (AXP): Free Stock Analysis Report

MASTERCARD INC (MA): Free Stock Analysis Report

VISA INC-A (V): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: AXP , MA , V

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