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PAYMENTSERVICE 2000 TO GENERATE BILLIONS OF DOLLARS OF COST SAVINGS FOR THE BANKING INDUSTRY

 SAN FRANCISCO, Nov. 17 ~PRNewswire~ -- Visa International annou nced today that its board of directors has endorsed unanimously the introduction schedule and budget for PaymentService 2000 (PS2000), Visa's new generation of electronic bankcard processing. PS2000 will provide Visa member financial institutions, during the five-year period beginning in 1994, with savings of U.S. $4 billion due to a reduction of potential losses from charge-offs and fraud. It will also offer significant additional income opportunities from increased card utilization.
 "The implementation of the first phase of PS2000 is on schedule and receiving overwhelming support from our regional and international Board of Directors," said Roger L. Peirce, executive vice president for Delivery Systems at Visa International. "Based on the board's decision to invest U.S. $50 million over the next three years to further develop and implement PS2000, this project has the highest priority for the Visa membership," he added.
 To address the wide diversity of requirements by various merchant segments served by the Visa payment system, PS2000 will be implemented in several phases over the next few years. The initial focus will be on the largest segment, "retail," which accounts for the majority of Visa card transactions. Therefore, Visa has designed an electronic payment service for retail-type of transactions which will become available in April 1993 for implementation in any national market using the VisaNet system for authorization and settlement services. The first market to set an implementation date is the United States, where the service will go into effect on the first of April 1993.
 By April 1994, the PS2000 electronic payment service concept will be further extended to other market segments, including airline, hotel, car rental, mail order and telephone order merchant categories. In addition, the service will be extended to cash disbursements and all international Visa card programs.
 "Currently, the VisaNet system is used in more than 20 countries for the authorization and settlement of both national and international transactions," Peirce explained. "These countries will be in an ideal position to fully implement PS2000 for their domestic payment systems as well," he continued.
 "We are currently discussing different options to migrate current payment services towards PS2000 with our members in the more mature card markets within our region," said Jean-Jacques Desbons, president and chief executive of Visa International EMEA (Europe, Middle East and Africa). "Our challenge is to gradually implement electronic payment service options also in marketplaces where the costs of telecommunication are still comparatively high," he explained.
 "Since the Latin America region has a number of countries which are already using the VisaNet system for their domestic interchange processing, we believe that many of these markets will take advantage of the new PS2000 capabilities quickly," said James F. Partridge, president of the Latin America region of Visa International. "We will work closely with our member financial institutions in these countries, and we will create business cases to evaluate the potential benefits and the investment needs specific to each domestic situation," he added.
 Visa International expects that all phases of PS2000 supporting the entire range of merchant segments accepting Visa cards will be fully implemented on a worldwide basis by 1996. By that time, member financial institutions will be able to fully benefit from PS2000 in the following areas:
 -- Reduced risk due to a substantial increase in on-line authorizations, better open-to-buy management, accurate indication of merchant category and location, as well as new techniques to identify potentially risky transactions.
 -- Cost reductions due to a dramatic decrease in the number of chargebacks and copy requests, and improvements in copy request handling.
 -- Increased sales volume due to vastly improved Visa card performance at the point of sale, particularly at travel and entertainment merchants, and through increased card issuance as a result of significantly tighter authorization control.
 "By the start of the 21st century, when the global Visa sales volume is expected to approach the U.S. $2 trillion mark, the Visa payment system will be processing more than 25 billion transactions per year," predicted Peirce. "By then, what we call PaymentService 2000 today will be a worldwide Visa standard and it will be difficult to imagine how we were ever able to run a payment system without it," he concluded.
 Visa, with more than 10 million acceptance locations, 292 million cards issued, and the leading ATM network, is the world's largest consumer card payment system.
 -0- 11~17~92
 ~CONTACT: Christoph Abt of Visa, 415-358-2469~


CO: Visa International ST: California IN: FIN SU: PDT

ML-TM -- SF005 -- 1857 11~17~92 12:42 EST
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Date:Nov 17, 1992
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