Visa a popular American multinational financial services company that was formed during the year 1958 and is headquartered in California, United States. VISA enables electronic fund transfer across the world through Visa-branded gift cards, credit cards, and debit cards.
Visa delivers financial institutions with Visa-branded payment products that are used to provide debit, credit, pre-paid, and cash access programs to the VISA customers. All VISA transactions across the globe are processed through VisaNet at their secure facilities. Their data centres are situated across Virginia, Ashburn, Colorado, Highlands Ranch, Singapore, and London.
VISA’s data centers are secured heavily against crime, natural disorders, and terrorism. It can handle about 30,000 simultaneous transactions and about 100 billion computations per second. Each and every transaction is checked against 500 variables that include about 100 fraud detection parameters like the location, merchant’s location, and spending behavior of the customer. Being a huge financial institution, let us discuss the SWOT analysis of VISA.
Strengths in the SWOT analysis of VISA
- Excellent distribution network – Ever since the VISA financial service has been established it has built up a reliable distribution network that can reach to huge potential market.
- Strong cash-flow – Visa has a strong free cash flow that provides the resources of the company to expand into new projects.
- Innovation – VISA has a successful track record to develop new innovative products.
- Excellent brand portfolio – Ever since the formation of VISA, it has been highly focused on building an excellent brand portfolio. This is the main strength of VISA. This helps the organization to expand into further categories.
- Automation – All the activities of VISA are automated thereby bringing consistency of quality to Visa Inc. products. It has helped the company to scale up and down as per the demand conditions that are seen in the market.
- Customer satisfaction – VISA has an excellent CRM in place that has helped them to achieve a high level of customer satisfaction and good brand equity among the probable customers.
- Sponsorship – VISA has sponsored many sports events at the international level.
- Secured data center – VISA’s data centers are secured heavily against crime, natural disorders, and terrorism. It can handle about 30,000 simultaneous transactions and about 100 billion computations per second.
Weaknesses in the SWOT analysis of VISA
- Risk – VISA is highly vulnerable to risk and fraud. Hence VISA transactions might lead to chaos at times.
- Unsuccessful in integrating firms with many work culture – VISA is not highly successful at integrating firms with many work culture.
- Gaps seen in product range – There are a few gaps seen in the products sold by VISA. This can be a weakness as this lack of choice can provide a new competitor a position in the financial market.
- Research and development – Investment in research and development is little low as compared to the fastest growing players in the financial industry. Although VISA spends a good amount on research and development, it fails to compete with its competitors in the industry with respect to innovation.
- Dependency – VISA has a heavy dependency on contractual relationships with large clients.
Opportunities in the SWOT analysis of VISA
- New technology – VISA’s new technology offers an opportunity to practice distinguished pricing strategy in the new market. It enables to maintain its loyal customers by providing great service and also lure new customers by means of value-oriented propositions.
- New markets – VISA opens up new market due to government agreement. This has helped VISA to adopt new technology standard and also government free trade agreement. This has helped VISA to provide an opportunity to enter into a new emerging market.
- Low inflation rate – The low inflation rate has bought more stability in the market thereby enabling credit at a low-interest rate to the customers of VISA.
- Digital currency – The widespread use of digital currency at the international level has seen a huge opportunity for VISA. By this, customers can easily transact money at any part of the world.
Threats in the SWOT analysis of VISA
- Global transactions – As VISA is being operated across the globe, it is exposed to currency fluctuations. This happens in a volatile political climate in many markets worldwide.
- Less skilled workforce – VISA faces a shortage of skilled workforce in many global markets that are a threat to the current products.
- Competitive environment – The highly competitive environment in the financial market is a big threat to VISA.