Visa Inc.
Visa Inc. is an American multinational payment card services corporation headquartered in San Francisco, California. It facilitates electronic funds transfers throughout the world, most commonly through Visa-branded credit cards, debit cards and prepaid cards.
Visa does not issue cards, extend credit, or set rates and fees for consumers; rather, Visa provides financial institutions with Visa-branded payment products that they then use to offer credit, debit, prepaid and cash access programs to their customers. In 2025, Visa's global network processed 257.5 billion transactions worth US$14.2 trillion.
Visa was founded in 1958 by Bank of America as the BankAmericard credit card program. In response to competitor Master Charge, BofA began to license the BankAmericard program to other financial institutions in 1966. By 1970, BofA gave up direct control of the BankAmericard program, forming a cooperative with the other various BankAmericard issuer banks to take over its management. It was then renamed Visa in 1976.
Nearly all Visa transactions worldwide are processed through the company's directly operated VisaNet at one of four secure data centers, located in Ashburn, Virginia, and Highlands Ranch, Colorado, in the United States; London, England; and in Singapore. These facilities are heavily secured against natural disasters, crime, and terrorism; can operate independently of each other and from external utilities if necessary; and can handle up to 30,000 simultaneous transactions and up to 100 billion computations every second.
Visa is the world's second-largest card payment organization, after being surpassed by China UnionPay in 2015, based on annual value of card payments transacted and number of issued cards. However, because UnionPay's size is based primarily on the size of its domestic market in China, Visa is still considered the dominant bankcard company in the rest of the world, where it commands a 50% market share of total card payments.
History
On September 18, 1958, Bank of America officially launched its BankAmericard credit card program in Fresno, California. In the weeks leading up to the launch of BankAmericard, BofA had saturated Fresno mailboxes with an initial mass mailing of 65,000 unsolicited credit cards. BankAmericard was the brainchild of BofA's in-house product development think tank, the Customer Services Research Group, and its leader, Joseph P. Williams. Williams convinced senior BofA executives in 1956 to let him pursue what became the world's first successful mass mailing of unsolicited credit cards to a large population.Williams' pioneering accomplishment was that he brought about the successful implementation of the all-purpose credit card, not in coming up with the idea. By the mid-1950s, the typical middle-class American already maintained revolving credit accounts with several different merchants, which was clearly inconvenient and inefficient due to the need to carry so many cards and pay so many separate bills each month. The need for a unified financial instrument was already evident to the American financial services industry, but no one could figure out how to do it. There were already charge cards like Diners Club, and "by the mid-1950s, there had been at least a dozen attempts to create an all-purpose credit card." However, these prior attempts had been carried out by small banks which lacked the resources to make them work. Williams and his team studied these failures carefully and believed they could avoid replicating those banks' mistakes; they also studied existing revolving credit operations at Sears and Mobil Oil to learn why they were successful. Fresno was selected for its population of 250,000, BofA's market share of that population, and relative isolation, to control public relations damage in case the project failed. According to Williams, Florsheim Shoes was the first major retail chain which agreed to accept BankAmericard at its stores.
The 1958 test at first went smoothly, but then BofA panicked when it confirmed rumors that another bank was about to initiate its own drop in San Francisco, BofA's home market. By March 1959, drops began in San Francisco and Sacramento; by June, BofA was dropping cards in Los Angeles; by October, the entire state of California had been saturated with over 2 million credit cards and BankAmericard was being accepted by 20,000 merchants. However, the program was riddled with problems, as Williams had been too earnest and trusting in his belief in the basic goodness of the bank's customers, and he resigned in December 1959. Twenty-two percent of accounts were delinquent, not the 4% expected, and police departments around the state were confronted by numerous incidents of the brand new crime of credit card fraud. Both politicians and journalists joined the general uproar against Bank of America and its newfangled credit card, especially when it was pointed out that the cardholder agreement held customers liable for all charges, even those resulting from fraud. BofA officially lost over $8.8 million on the launch of BankAmericard, but when the full cost of advertising and overhead was included, the bank's actual loss was probably around $20 million.
However, after Williams and some of his closest associates left, BofA management realized that BankAmericard was salvageable. They conducted a "massive effort" to clean up after Williams, imposed proper financial controls, published an open letter to 3 million households across the state apologizing for the credit card fraud and other issues their card raised and eventually were able to make the new financial instrument work. By May 1961, the BankAmericard program became profitable for the first time. At the time, BofA deliberately kept this information secret and allowed then-widespread negative impressions to linger in order to ward off competition. This strategy worked until 1966, when BankAmericard's profitability had become far too big to hide.
The original goal of BofA was to offer the BankAmericard product across California, but in 1966, BofA began to sign licensing agreements with a group of banks outside of California, in response to a new competitor, Master Charge, which had been created by an alliance of several regional bankcard associations to compete against BankAmericard. BofA itself could not expand directly into other states due to federal restrictions not repealed until 1994. Over the following 11 years, various banks licensed the card system from Bank of America, thus forming a network of banks backing the BankAmericard system across the United States. The "drops" of unsolicited credit cards continued unabated, thanks to BofA and its licensees and competitors until they were outlawed in 1970, but not before over 100 million credit cards had been distributed into the American population.
During the late 1960s, BofA also licensed the BankAmericard program to banks in several other countries, which began issuing cards with localized brand names. For example:
- In Canada, an alliance of banks issued credit cards under the Chargex name from 1968 to 1977.
- In France, it was known as Carte Bleue. The logo still appears on many French-issued Visa cards today.
- In Japan, The Sumitomo Bank issued BankAmericards through the Sumitomo Credit Service.
- In the UK, the only BankAmericard issuer for some years was Barclaycard. The branding still exists today, but is used not only on Visa cards issued by Barclays, but on its MasterCard and American Express cards as well.
- In Spain until 1979 the only issuer was Banco de Bilbao.
After lengthy negotiations, the committee led by Hock was able to persuade Bank of America that a bright future lay ahead for BankAmericard — outside Bank of America. In June 1970, Bank of America gave up control of the BankAmericard program. The various BankAmericard issuer banks took control of the program, creating National BankAmericard Inc., an independent Delaware corporation which would be in charge of managing, promoting and developing the BankAmericard system within the United States. In other words, BankAmericard was transformed from a franchising system into a jointly controlled consortium or alliance, like its competitor Master Charge. Hock became NBI's first president and CEO.
However, Bank of America retained the right to directly license BankAmericard to banks outside the United States and continued to issue and support such licenses. By 1972, licenses had been granted in 15 countries. The international licensees soon encountered a variety of problems with their licensing programs, and they hired Hock as a consultant to help them restructure their relationship with BofA as he had done for the domestic licensees. As a result, in 1974, the International Bankcard Company, a multinational member corporation, was founded in order to manage the international BankAmericard program.
In 1976, the directors of IBANCO determined that bringing the various international networks together into a single network with a single name internationally would be in the best interests of the corporation; however, in many countries, there was still great reluctance to issue a card associated with Bank of America, even though the association was entirely nominal in nature. For this reason, in 1976, BankAmericard, Barclaycard, Carte Bleue, Chargex, Sumitomo Card, and all other licensees united under the new name, "Visa", which retained the distinctive blue, white and gold flag. NBI became Visa USA and IBANCO became Visa International.
The term Visa was conceived by the company's founder, Dee Hock. He believed that the word was instantly recognizable in many languages in many countries and that it also denoted universal acceptance.
The announcement of the transition came on December 16, 1976, with VISA cards to replace expiring BankAmericard cards starting on March 1, 1977, and the various Bank of America issued cards worldwide being phased out by the end of October 1979.
In October 2007, Bank of America announced it was resurrecting the BankAmericard brand name as the "BankAmericard Rewards Visa".
In March 2022, following the Russian invasion of Ukraine, Visa announced that it would suspend all business operations in Russia.