Visa made an announcement on March 26th, revealing that its payment services in the Asia-Pacific area have surpassed 1 billion tokens in usage. In addition, these services have generated a market uplift of over $2 billion in the previous year.
Launched in 2014, Visa Token Service (VST) acts as a connection between traditional banking account information and digital payment services like Google Pay and Apple Pay. Essentially, VST replaces the standard 16-digit credit or debit card number with a secure numeric token when consumers make purchases. This allows consumers to share financial information without compromising their private details or banking information.
VST operates on VisaNet, the company’s exclusive network that has the capacity to process over 56,000 transaction messages per second, according to company documentation.
Tokenized payment methods, like VST, are commonly used for cross-border payments and international travel. Exchanging cash or conducting wire transfers across different currencies can be filled with challenges. By utilizing tokenized assets such as cryptocurrency or tokenized payment services like VST, many of the difficulties associated with these transactions can be avoided.
A recent study by Visa discovered that 97% of travelers in the Asia-Pacific region prefer to make payments using methods other than cash. As a result, the average spend per trip reached $2,525 in 2023.
The tokenization of traditional assets into digital currencies and payment facilitators has experienced significant growth in the aftermath of the COVID-19 pandemic. As travel rebounds and the world recovers, consumers increasingly prioritize 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, emphasized in a press release that tokens “pave the way for the future of commerce.” Previn Pillay, head of merchant sales and acquiring for Asia Pacific at Visa, further encouraged more merchants to adopt tokenized payments, as this technology can directly impact their revenue.
Related: Visa and Mastercard are expected to play a significant role in driving cryptocurrency adoption in the coming year.