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Visa (credit Card)




Visa is a Brand of Credit Card and Debit Card operated by the '''V'''isa '''I'''nternational '''S'''ervice '''A'''ssociation of San Francisco, California , USA , an Economic Joint Venture of 21,000 Financial Institutions that issue and market Visa products. The Visa card was launched in 1976 and the card was derived from the earlier BankAmericard issued by the Bank Of America .


BACKGROUND

Internationally, BankAmericard was known by other names prior to the introduction of the Visa brand for the network. The blue-white-gold motif used by BankAmericard was also used for these cards. In the United Kingdom , it was known as the BarclayCard, issued by Barclays Bank . In Canada , an alliance of banks (including Toronto-Dominion Bank , Canadian Imperial Bank Of Commerce , Royal Bank Of Canada , and Bank Of Nova Scotia ) issued credit cards under the '''Chargex''' name. In France , it was known as '''Carte Bleue''' (Blue Card).


CORPORATE STRUCTURE

Visa offers through its issuing members the following types of cards:

  • pay now ( Debit ) cards

  • pay later ( Credit ) cards and

  • prepaid cards


Visa operates the PLUS ATM network and the Interlink EFTPOS network.

Visa's Corporate Structure is regionally de-centralised, which is unique in the payment scheme industry.

Legally, Visa comprises four non-stock, separately incorporated companies that employ 6000 people worldwide: Visa International Service Association ("VISA"), the worldwide parent entity; Visa U.S.A. Inc.; Visa Canada Association; and Visa Europe Ltd. The latter three separately incorporated regions have the status of group members of Visa International Service Association, whereas the unincorporated regions (Visa Latin America Visa Asia Pacific and Visa Central and Eastern Europe, Middle East and Africa [CEMEA ) are divisions within VISA.

The de-centralised nature of Visa allows it to respond to member needs and adapt the Visa International rules and products to suit the individual needs of their regional members. Regional banks therefore have a strong stake in the governance of their region.

The Visa International Board has the dual responsibilities of:

# Oversight of the worldwide interests of the Association
# Strategic direction and supervision of the three unincorporated divisions and the central staff of Visa Worldwide services.

The Visa Association is not a profit- driven organisation and the four companies that make up Visa issue no cards and make no loans. Members (about 21,000 worldwide) fund day to day management and make the investments needed to maintain and develop the Visa payment system. Fees are levied according to the following formula:

Operating and Marketing costs
+ Investments in new products, platforms and systems
+ Increase in Reserves
= Members annual fees


LOGO

The blue and gold in Visa's logo were originally chosen to represent the blue sky and golden-colored hills of California , where Bank Of America was founded.

The Visa Flag Symbol is used by merchants to denote the acceptance of Visa credit cards.


ISSUERS

JPMorgan Chase is the world's largest issuer of the Visa card after acquiring Bank One which was the largest Visa card issuer.


OLYMPIC SPONSORSHIP

Since the 1988 Calgary Winter Olympic Games , as a worldwide Olympic partner, Visa is the only form of electronic payment accepted at all venues and Olympic-related transactions. Its current contract with the IOC as the exclusive payment card will continue through 2012.


LEGAL PROCEEDINGS

  • Visa settled a Lawsuit to Wal-Mart for billions of dollars. According to a website associated with the suit ( link ), Visa and MasterCard settled their claims for a total of $3.05 billion, and Visa's share of this settlement is reported to have been the larger. As of the spring of 2005, it is expected to have raised its interchange rate from 1.634% to 1.99%, which can be expected to affect the discount rates paid by retail locations to the banks with which they deal.


  • It has been rumored for years that Visa and MasterCard have been working in tandem for a long time; some believe they are really the same company. In fact, while most card-issuing banks in the United States are members of both Visa and MasterCard , the associations are distinct, and have some key differences. The United States Department Of Justice unsuccessfully sued the two associations over allegations that their common ownership was detrimental to competition. The United States Department Of Justice was successful with claims brought at the same time against both companies under the Sherman Antitrust Act for preventing banks from issuing American Express cards. In late 2004, the Supreme Court declined to reconsider a lower court's ruling and thereby cleared the way for MasterCard- and Visa-issuing banks to begin issuing American Express and Discover cards. Subsequently, several major issuers like MBNA and Citibank have begun issuing American Express cards, in addition to Visa and MasterCard.

  • In 1999, a Malaysian company called Sheimer tried to register "visa" as a trade mark for condoms (being a pun on "permit to enter"), which, despite being in a different business, was rejected because, among other reasons, Visa had a "strong distinctive character and reputation in the United Kingdom" and "the use of Visa for condoms would be detrimental to the distinctive character of Visa International's earlier trade mark for financial services." {Link without Title}



BOARD OF DIRECTORS

As of December 2004, the following banks are represented on Visa's U.S.A. board of directors:

# Bank Of America (2 chairs)
# JPMorgan Chase (2 chairs)
# US Bancorp
# Wachovia
# Wells Fargo
# Providian
# First National Bank Of Nebraska
# Texas Independent Bancshares
# National City Corporation
# SunTrust Bank
# Merrill Lynch


SEE ALSO



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