On September 5, payment giant Visa announced the expansion of support for USDC payments. Now, a pilot project, launched together with merchant acquirers Worldpay and Nuvei, will utilise Solana. Let’s learn more about the announcement and regular payments overall.
Problems that Visa is trying to solve
When customers pay for purchases using cards, payments seem fast and convenient. However, in reality, this process is a bit more complicated. It involves the transfer of funds between the buyer's card issuer (the issuer) and the merchant's bank (the acquirer). Moreover, the process also faces various challenges like interruptions due to banks working hours or difficulties caused by fund conversions, especially in cross-border payments.
Previously, paying for purchases with a Crypto.com Visa Cryptocard required transfers from crypto to fiat, which were accompanied by costly and time-consuming bureaucracy. Following their cooperation, the companies switched to direct transfers of funds. Now, they conduct them via USDC on Ethereum to a Visa Treasury-managed Circle account (Circle is the issuer of USDC stablecoin). Such a solution reduces costs for both parties.
Cuy Sheffield, Visa's head of cryptocurrencies, illustrated the principle in the tweet below.
Currently, Visa is taking it a step further based on this experience.
Details of the recent announcement
Worldpay and Nuvei are acquirers that process bank card payments for businesses around the world. Now, their customers can choose to settle in USDC instead of regular fiat money. This shift will accelerate the funds flow, opening up an easy access for businesses to accept USDC payments from their customers.
In addition to Ethereum, Visa has added support for USDC transfers on the Solana network. As the company notes, "This makes Visa one of the first major payments companies at scale to directly utilise Solana for live settlement payments between its clients".
In response, Solana (SOL) saw a slight increase from $19.5 to $20.6. However, it is now back to its pre-announcement price and currently trading at around $19.37.
Solana ranks ninth in terms of capitalization, which accounts to $8 billion.
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