Please welcome Senior Vice President, Investor Relations, Julie Chariell.
Good morning! Hello, everybody. Welcome, and thanks for being here with us today, and thanks to those joining us, on the webcast. We have a jam-packed day. We're very excited to get started. Here's the agenda behind me. So just a couple of quick call-outs. We'll have a few opportunities today for Q&A, with a round of our, with our business unit leaders. We'll have a round with our COO, Guy Chiarello, and at the end of the day, of course, with Frank and Bob. We have a great experience downstairs in the boardroom at noon for lunch. During lunch, members of our management team will be available at each table. You can see their bios in the program.
They are seated in the back, so maybe if you all can stand up and folks can get a look at you, if they want to come and find you, in our lunchroom, they will be there, and happy to chat for a while. Thanks. And after our formal program, you'll have a chance to visit our solutions showcase, for live demos. So if you look on the back of your name badge, you'll see a table number for your lunch, and you'll see your station starting number for the solutions showcase at the end of the day. Here's our normal disclosure of about forward-looking statements and so on. You all know that. So with that housekeeping, let's get started.
Please welcome Chairman, President, and Chief Executive Officer, Frank Bisignano.
Good morning.
Julie recognized my management team that's in the back there, and obviously we have great senior leaders talking. I'd also like to recognize four board members who are here, and if you're on the Fiserv board, I might ask you to stand up, and I thank you for everything you do for us every day. Good morning, everyone.
I'd like to thank you for joining us here at the New York Stock Exchange, in these hallowed halls of capitalism, and via the webcast, likely built on technology funded in part with capital raised right here. Our executive offices are just steps away at Bowling Green, and so I'm reminded of where I started over 40 years ago, here on the floor of the New York. So I suppose, in a way, I've come full circle, from taking orders for stock trades to having the honor of leading a company whose shares trade on the New York. I'm so privileged to lead Fiserv for many reasons, and let me highlight just two. Our products and services touch nearly 100% of U.S. households, and we are a partner of choice for the largest retailers, restaurant chains, petrol companies. Everybody knows I love a small pizzeria.
From the local credit union to the leading banks of the world. We carry this responsibility with pride, and our resilient business model ensures that we can deliver. With $18 billion in revenue, 85% recurring revenue, high mix of non-discretionary spending volume, $4 billion in free cash flow, and broad borrowing capacity, we have significant ability to invest in innovation during good times and sustain profit growth in tough years. We've proven this resilience with 37 years of consecutive double-digit adjusted earnings per share growth. To celebrate this and the occasion to come together today, we've given you a prepaid card. If you're in the room, can you pick it up and raise it just so I know that you got it? You didn't take somebody else's. Don't anybody take anybody else's prepaid cards. Please, please.
It is a prepaid card, so we loaded it with, you can guess what?, $38. To commemorate what we expect to be our 38th double-digit growth year in 2023. We manufactured the card. We'll process the transactions you generate with it, and we'll maintain the ledger that tracks its balance over time. It works. We hope you enjoy spending it. Of course, there's a little part of me that hopes you don't, because that's our money, and we'll keep it, but we want you to spend it. Particularly at one of our great clients, at one of our great client locations. And, of course, you all know you can find ONE on any street in New York City. So thank you.
Since our last investor conference, we've delivered on our commitments, delivering 11% organic revenue growth in each of the past three years, delivering a 19% adjusted EPS CAGR in the same period, and delivering a cumulative $11 billion in free cash flow. If you saw our press release this morning, you know that our plan is to sustain the lead we have earned and the strong performance that goes along with it. We will do it with the same values and practices that brought us this far. First, with speed of execution, because that is our leadership style. At the same time, we require intellectual honesty in every discussion we have, internal and external, and analytical rigor in every decision we make and every project we take on for our clients.
Finally, much like you here today, we believe in showing up daily, taking the field, not letting our teammates down, and giving our best effort always. We remind ourselves of these values regularly, and that has made a big difference. That difference shows up here. A lot of leading positions and accolades. Proud as I am, we are always thinking of ways we can do better, daily. We're motivated to sustain these kind of results and continue our pursuit of excellence. Let's take a look at how we performed against the guidance we gave you three years ago and discuss how we plan to extend that performance. At our December 2020 investor conference, we set our outlook for the medium term, and we're on track to exceed our commitments on revenue, operating margin, and EPS.
We grew 11% organically for each of those three years, adding $5.1 billion of additional organic revenue. We expect to grow at a similar or slightly better pace over the next three years. Margins should expand at least another 300 basis points over that period and reach 40% in 2026. Cumulative free cash flow is expected to be $15 billion by 2026, ahead of $11 billion over the prior three years. I'd like to explore the unique set of assets that had gotten us here, and will continue to take us further down the path of leadership, growth, and profitability. On their own and cumulatively, these assets create significant competitive differentiation for Fiserv. I'll start with our clients. I feel it's always the best place to start.
Our client franchise would be the envy of any business leader with this expansive, diverse, and global set of clients. It includes the largest merchants, like Walmart and Inspire Brands, all of the top 100 US banks, such as B of A, Wells Fargo, regional banks, such as NYCB and Webster, community banks, including Central Bank and American National Bank of Texas. And our global footprint serves millions of small businesses around the world, including restaurants, retailers, and service providers, as well as leading financial institutions such as Caixa, Lloyds, and Bancolombia. It is essential to develop and grow with our clients and deliver top-notch products. We offer not only the broadest set of products, but we now sell them as a full service, integrated suite or as an open best-of-breed solution.
Now we stand alone in the market with the most complete set of merchant solutions and financial solutions. This means we have the unique opportunity to win where these product sets overlap. We are already selling across businesses today. We sell cardholder experiences from CardHub, along with online banking. We sell debit network access to merchants, along with acquiring. We enable core banking clients to offer merchant acquiring services, and we have many more examples spanning multiple products. Let's talk about embedded finance. Much like we were a fintech before that term was known, we've also been generating revenue from embedded, embedded finance solutions before the phrase was coined. You'll hear from Suzan and Andrew on that later. One of the benefits of being a scaled industry leader is the ability to invest in innovation.
The breadth of our reach and depth of our customer relationships allow us to see beyond the next disruptive competitor and use our investment capacity to buy, build, or implement the latest advance. Over the past several years, we put our resources to work to modernize our technology, develop new products, enter new markets, and acquire key technologies. Bob, good old Bob, will discuss... that was not an age comment on him either. Well, we'll discuss our investments more later, but we are in the enviable position of generating highly recurring revenue and strong free cash flow that make funds available for investment year in and year out. Our technology resources are a strategic advantage, particularly when combined with our investment in innovation. Together, they form a significant competitive advantage. The scale of our tech platforms and our deep technical prowess is unmatched.
Our largest individual job category inside this company is software engineer, and we currently have 12,000 developers booking time on projects today. We process an average of 500 million transactions per day, and at peak, handle 25,000 transactions per second. After an era of modernization, we moved on to integrating our products so they all work well together, and migrating to open architectures, so they run on any platform. Now we are making our solutions modular. It allows us to serve any prospective merchant or FI, whether they want a full-service solution or the ability to mix and match across our individual best-of-breed products. This brings significant expansion of our total addressable market to clients who do not run our operating systems or who want to keep some of their current solutions. Some clients will retain multiple vendor solutions, but others will eventually migrate to our platforms.
Either way, we win, we grow. Later today, Guy is coming up to discuss multiple other innovations that have supported our growth and will enhance our standing as a go-to source for next-generation solutions for our clients. Equally important are our people, and we have a superb management team and a deep bench. My management committee, including those on stage with us today, are just a small representation of a much deeper and equally talented team. They are a reflection of our ability to attract and retain talent at industry-leading levels. We rotate them throughout the organization until they know our clients' businesses inside and out. Our distribution network is unparalleled. The multiplying power of bank partners, ISOs, ISVs, and agents, marketing and selling our products and services, has given us great reach and is largely responsible for many of the number one positions we have today.
And lastly, on our long list of assets is strategic vision. Given the experience this management team has at some of the finest financial institutions in the world, we are often recognized as proven operators. Some even think of us as turnaround specialists, but our track record points to being builders of great businesses. The proof points on strategic vision are clear. When we acquired Clover 10 years ago, it was seven engineers and three patents. We also made early investments in Finxact, Ondot, and BentoBox, which reflected our strategic vision for growth, starting with SaaS-based payment operating systems to cloud-native core account processing systems, specialized in integrated cardholder experiences and vertical specialized software. Now, we own these assets outright, and they are thriving. As early as 2016, I had a deep belief that core banking and merchant acquiring combined held strong synergistic opportunity.
This started with the investment in Finxact and culminated in the merger of Fiserv and First Data, bringing together the best core account processing systems of Fiserv and the leading merchant processing business led by Clover at First Data, along with payment services, debit and credit processing, and debit networks from both firms. We created what stands alone today as a one-of-a-kind property. That result of that merger was share appreciation of 65% since the announcement, a return that outpaced our major competitors and over half of the S&P 500. We attribute this performance to superior underlying assets, extensive integration, and incremental investment. In my view, the book is now closed on the fintech deal stock era and related comparisons. Fiserv has moved on to a value-added software and services-led model, supported by operating systems as key enablers.
To reflect this new era, we are realigning our businesses by client offerings, Merchant Solutions, and Financial Solutions, which each represent about half of the total business. This move was really four years in the making, as we began realizing greater synergies from the merger beyond original expectations. This led to a change in the way we operate, and finally, to this creation of two client-led businesses from three service-led businesses. In Merchant Solutions, we'll be reporting business lines around merchant type, small business, enterprise, and processing. In Financial Solutions, we'll report business lines around functions, since FIs of all types use the same or similar functional products for banking, digital payments, and issuing. We have been gradually changing the way we go to market to serve these two client types, and this new alignment will better reflect how we engage with our clients.
Merchants are increasingly buying payments products, so we are moving those particular solutions from Payments and Network segment into merchant solutions. These include pay-by-bank services, stored-value payments, and biller solutions. Banks and credit unions are increasingly buying across our whole suite of services, so we continue to integrate our solutions in banking, digital payments, and issuing, and we'll place them in a single business, Financial Solutions. Our new structure will take effect first quarter 2024. Bob will walk you through the numbers later today, and you'll see more detail once we start reporting this way with our Q1 2024 results. The main shift in our go-to-market approach is a greater focus on value-added software and services in all of our business lines, with the operating systems taking the role of processing engines and integration points for value-added solutions.
Operating systems bring scaled processing economics, recurring revenue, and simplified VaaS integration. As VaaS penetration grows, it will positively contribute to revenue per client. You're familiar with us referring to Clover and Carat as operating systems, and now we're extending the concept to our other business lines. Financial Solutions operating systems include, for issuing, Optis and FirstVision, and for banking, DNA, Premier, and Finxact, just to name a few. Each of our business leaders will discuss these more a bit later, along with their portfolio of value-added solutions. Our two client sets, merchant and financial institutions, are increasingly converging in the client's office. Those of you who have been following us for a while know that the original Fiserv model was to sell the core system, and then over time, sell more and more surround solutions to complement it. That model still exists, but it's maturing.
With the addition of merchant acquiring and payments products through First Data, we have many more cross-sale opportunities. Now, we don't necessarily need to start with the core. Just a few examples. We start by selling debit networks, then add Merchant Solutions, followed by VaaS. Other times, we may start with value-added solutions, win the digital banking business and then the core. With this new approach, we have many more starting points to sell to our clients, giving us the opportunity to grow more new client relationships. Other cross-sale opportunities go even deeper and are just getting started... In embedded finance, merchants want to offer financial services to get closer to customers and enhance their wallets, while financial institutions want to reinvigorate their merchant client relationships to drive profitable services like lending.
Fiserv is in a unique position to serve this construct with both merchant and financial solutions under one roof. We believe this represents an addressable market expansion opportunity with greater customer lifetime value and sustainable revenue growth. In the B2B space, we are rolling out a small business bill pay solution with Melio, essentially a new and very significant value-added solution. It will be available for our FI clients to offer to their merchant customers, for merchants on Clover to find and use from their dashboards, and for our ISV partners to resell to our non-strategic verticals. This is a single product that serves both of our businesses and is particularly attractive as a capital-light way for FIs to generate new revenue and for merchants to improve efficiency and lower costs.
We are going to spend time today sharing with you our strategies to sustain and, in some places, accelerate top-line growth. What you see here is a sampling of the specific growth strategies that Suzan, John, and Andrew will discuss shortly. Importantly, you will see that each one is tied to a specific driver of growth. Each one includes a plan to add more clients, retain and grow with our clients, or expand our share of wallet. The icons on the page reflect expected outcome and are reminders of how you should measure our success. Before I wrap up for now, let me share an overview of our CSR initiatives and some accomplishments in the past year. It's important you understand that our diversity and community initiatives have been a part of what we do for over a decade, and we believe that's made us a more successful company.
We are guided by four priorities tied to the goals for our people, our communities, our business practices, and sustainability. We take pride in the various recognitions that we've received as an employer, and I am personally very focused on people development and internal mobility. I'm also a strong believer in employee stock ownership. We have a very high portion of employees receiving stock-based compensation. We have a culture of ownership that is evidenced by our best-in-class ownership requirements for our senior executives, as well as ownership requirements for a larger group of associates, including all senior vice presidents. Each and every one of us all share in projects to help our local communities. Diversity in our people platform is reflected in diversity in our board of directors.
We have achieved LEED Platinum status at our Berkeley Heights, New Jersey, Tech Innovation Center, and LEED Gold in our New York City offices. And finally, we've reported to the Carbon Disclosure Project and track our GHG emissions. Let me leave you with a few thoughts before I hand over to my exceptional team. We have a very attractive business model represented in this graphic. It starts with our great group of assets, including our strong balance sheet, which fuels our investment in innovation. We add our broad portfolio of solutions, many of which have recurring revenue streams, and together, they generate sustainable revenue stream, three years in a row of 11% organic revenue growth. Thanks to our scale and operating leverage, we generate high incremental margins that help drive ongoing operating margin expansion.
We convert much of that probability to cash, and with that strong free cash flow, we reinvest, buy back our stock, and make acquisitions. That reinvestment, organic and inorganic, strengthens our assets and expands our portfolio, and the virtuous cycle continues. Supporting it all is the discipline of this management team. We are prudent in M&A. We integrate quickly and benefit from the power of our franchise to drive revenue and profitability. With this balanced approach, we combine the track record of resiliency with the faster growth of an innovating tech company. As many of you know, I love teams. What you will see today is a stacked world-class team with a strong bench behind each player. We work better as a team than individuals. We put a lot of wins on the board, and you can count on us to continue to execute on our strong game plan.
I look forward to you hearing our plan today and coming to that same conclusion. For a couple of decades, I've been doing business in Latin America, so I'm pleased to introduce Juan Carlos, CEO of Bancolombia, a good client, a great friend, and the CEO of the largest bank in Colombia.
I am Juan Carlos Mora, CEO of Bancolombia. We attract deposits and offer retail and commercial banking services. As Grupo Bancolombia, we have more than 30 million customers in Colombia, Guatemala, El Salvador, and Panama. Our customers expect partners that evolve constantly to back them in any need they may have. We promote financial inclusion so more people and businesses can have the same opportunities to access financial services. We have built a close collaborative and trust-based relationship with Fiserv. We are moved by a common purpose, delivering better experience and solutions to Bancolombia's customers. Fiserv plays a critical role since it is part of our most daily business with the payment means processing, guaranteeing quality, availability, and good timings for complex solutions. In this way, we can deliver a superior and flawless experience to achieve our customers' loyalty and recommendation.
Please welcome Head of Global Business Solutions, Suzan Kereere.
Thank you. Thank you, Frank. That was a great opening. And thank you to all for joining us today. So I'm really grateful for that example of a partnership with a great bank, Bancolombia. I'm more grateful for it because it generates a ton of value to the merchant business, but that's just me speaking selfishly. But also grateful because of my colleague, Gustavo Marin, who runs the Latin America region and has done a superb job to grow the business. So I can't actually say it any better than Frank did. Our clients are at the heart of what we do. I'm Suzan Kereere. I lead the global business solutions business. I've been in and around financial services and payments for many years. I love this business. I love it here in particular, and I joined Fiserv about two and a half years ago.
As the head of the business, I am going to talk a little bit about why we are so energized about the opportunities for growth in merchant, but at Fiserv more broadly. What I plan to do is talk you through our overall performance, how we think about the outlook for the business, and then dig into the strategic priorities by each business. It will bring to light a lot of what Frank said. A little bit about how we think about the business as a whole. Our mission in merchant, not surprisingly, is to help these businesses run, fund, and grow.
And it doesn't matter whether you are an entrepreneur, a local corner store owner, a developer, a large retail brand, a global e-commerce platform, a PFAC. We say we stand behind you every step of the way, and we do it through purpose-built commerce solutions. We are very fortunate to be one of the largest acquirers, not just the largest, but the single largest acquirer in the world. We do this business in more than 50 countries... That's a big number. We process over $4.3 trillion in GPV, and we do that for e-commerce and for card present. And as Frank said, distribution is our core strength. We have more than 6 million merchant outlets on our platform.
Between banks, like Bancolombia, software companies, resellers, agents, we have more than 5,000 distribution partners, all of them working with us to make it easier for businesses to grow. Frank said, and he says this often: "We are very privileged to have the kind of hand we do with our customers, a large and very diverse base of clients around the world." We also have a very well-diversified portfolio within the business, and I'm going to highlight a few elements about the business as it stands today. So if you start on the left, and building on what Frank said earlier, we are updating the composition of what makes up Merchant Acceptance. Previously, back in the full year 2022, Merchant Acceptance delivered $7.3 billion in revenue.
As we said, we are realigning a few of the strategic assets from across financial solutions into the Merchant Acceptance business, and those assets include stored value, biller, and pay by bank. The pay by bank is an alternative payment solution. With those additions, the new merchant business is $7.9 billion in revenue for the full year 2022. The growth rates on this new segment is slightly slower, but we believe that when we bring these assets together, bundle them, embed them in how we sell, and go to market consistently, that will give us an opportunity to actually drive and accelerate growth. As part of this realignment, we're also renaming Merchant Acceptance to Merchant Solutions. It is much more reflective of what we do in the business, more holistic, more services-based, more focused on solutions.
So if you move to the middle of the page, you see the new revenue mix by end market. Small business is the largest share at about two-thirds of the revenue we do, followed by enterprise. And so when you combine those two things, that's about 90% of the revenue. Processing makes up the other 10%+ of the business. This business is a more stable business. It's much more strategic in value, so it has value across the firm, not just in Merchant Solutions. And then, as you see on the chart below, our mix of revenue by region shows that we also have a very diverse mix of businesses across each of the regions. And as we'll talk more and talk later, you've seen in our numbers that that business, especially the business outside the U.S., is accelerating in a growth momentum.
If you're close to the right side of the page, the business is also very well-balanced between on and offline, and balanced between discretionary and non-discretionary payment volume. It is this diversity, this stretch across regions, across payment types, across currencies, across geographies, that gives us a long-term sustainable growth. I want to double-click for a moment on international, because, as I said, you've seen momentum in our results. So international represents about 45% of the global merchant count. We serve some of the largest brands, across the region, like Microsoft, Avis, Caixa, and Lloyds. And if you think about why we win, it's a combination of our local expertise and innovation, and that, combined with the scale and reach of our global platforms. Product extensibility is also paying off quite well.
Our growth strategies are consistent around the world, and as we'll talk through the course of today, it's all about winning, retaining and growing, and expanding with clients. So here's how it all adds up in the medium term. Our market growth expectations are a combination of GDP growth in the countries we operate in and the continuing shift of cash to digital. But quite honestly, it is our ability to outperform that gives us conviction for sustained, durable growth. And the factors underpinning this outperformance are three that I'll call out. The first is our strength of distribution. We are winning in faster-growing verticals like digital platforms. We're also expanding our reach through direct selling and digital acquisition, and as I said earlier, we're growing in every region. The second is our progress on software and services.
Our operating systems, Clover and Carat, continue to simplify how our customers consume services. It is this that allows us to drive much higher product attach rates and win with new and existing customers. The third is value-based pricing, especially as we continue to invest in our operating systems. So when you combine these things together, this is what builds conviction. We believe we can outgrow, and we are doing that now. So I'm going to talk about each line of business. Again, I'll pick up a phrase from Frank: We do live in the customer's office, whether you're a small business or a large enterprise. This is how we go to market around the world. Clover and Carat are the operating systems that deliver the flywheel of services for these businesses. So I'm going to start by talking more about small business. Small business is a diversified portfolio.
It's diversified in merchant size, in industry, in geography, and in sources of recurring revenue. If you're looking at the chart on the left, we're winning more with larger clients, those clients that process over $10 million in volume. Those clients also consume more services. In the middle, you see we are deepening our penetration in our focus verticals, restaurant, retail, and services, with mid-teens revenue growth. On the right, our strategy to shift to more software and services is bearing fruit, with revenue growth at 33%, outperforming the rest. Small business is on track to deliver $5.8 billion in revenue this year, with growth driven from bank partners like Caixa in LatAm, as well as many tech and software partners around the world. While there is strong performance across all small business, the merchants with Clover outperform, growing revenue 3x faster than the rest.
The merchants that use Clover show the characteristics you would expect. They have 2x higher attach rates. They have more than 30% higher average revenue per unit, that's ARPU, and much lower churn. Continued penetration of Clover into the base drives our conviction to sustain long-term growth. Let's talk more about how the Clover operating system is performing. This Clover flywheel, it really makes it easier for small businesses to do their most important tasks. Those tasks range from how they serve their customers, to how they take care of their employees, to how they manage their cash flow, and to how they run their businesses front to back.
Clover is winning in the marketplace because of its depth, its breadth in choice of solutions across omni-channel, its flexibility to serve customers across their life cycle, and most importantly, Clover is winning because of the associates who support our clients every day. This past quarter, Clover hit yet another milestone. We shipped our 3 millionth device in support of the 700,000 merchant outlets on the platform today. Now, this accounts for multi-location merchants. It also accounts for the natural cycle of new business starts and stops, and it accounts for device churn as businesses grow. And at just over $250 billion in payment volume, we like to say that Clover is only just getting started. So here's Dan Bjerke, he's Head of Clover. Let's watch him explaining why the power and potential of Clover is all the way ahead of us.
At Clover, we are champions of local businesses. Their grit and determination inspire and motivate us, and our mission is simple: to be the operating system of choice to local businesses so they can thrive and serve their communities. As an integrated operating system designed for small and medium-sized businesses, Clover provides a complete set of cloud-based hardware, software, and payment solutions, everything needed to run a business without the hassle of managing multiple vendors. With access to over 700 software apps, there's always a solution to meet the unique needs of any business. And with an open platform, Clover delivers across all industry verticals in the way our customers want to be supported. Since the launch of Clover, the business has experienced rapid growth, currently serving nearly 700,000 businesses with over $272 billion of annualized sales volume.
Businesses choose Clover for many reasons, including the breadth of solution options and ease of use, the efficiency and growth gained through Clover Automation, the local and specialized support provided by Clover and our channel partners, and our customers have confidence their mission-critical technology is backed by a Fortune World's Most Admired company in Fiserv. The outcome will be more Clover customers using more software and services to run and grow their business, resulting in higher average revenue per customer, greater software revenue share, and outpaced durable revenue growth.
I'm so proud of the work that Dan and his team are doing to grow the business, and equally proud of the partnership with you, Guy, on the technology side of the operating system. So to grow Clover, we're focused on three objectives: add more clients, retain and grow them, and expand their share of wallet. We're executing well against those objectives. We are growing new clients at a much faster rate, adding over 130,000 outlets in the last two years. That equates to about 7,000 net new clients a month. We're growing payment volume per outlet by double digits, and we're expanding ARPU at nearly 3x the rate of volume, as we increase product attach rates per client. So these are some of the proof points that showcase why Clover's flywheel drives outperformance.
Let me take you through an example of how this flywheel comes to life with one of our restaurant clients, Fini Pizza. It's one of my favorites. Fini is a New York-based slice shop. It's a favorite to many in the local area. Sean Feeney is known for other successful brands like Lilia and Misi. He opened the doors to Fini about over a year ago, and he chose us to power his business front to back. We enable online ordering, we do their website design, we help with table management, and so much more. And it is the combination of Clover and Bento that gives us solutions to serve customers like Fini. Across this merchant base, what we see is ARPU that is 3x higher than those merchants who consume our software and services.
As merchants like Fini grow in size and in locations, we grow with them. We are so privileged to be in partnership with Sean and with hundreds of thousands of businesses like Fini. So our Clover software and services go well beyond restaurant. We're just as focused on the end-to-end solutions for retail and for services, whether that's inventory optimization for a retail boutique or appointments and reminders for a barber. We also offer a set of general-purpose services that everyday businesses need, like Clover Capital, payroll, and loyalty. And we believe that investing here is how we best serve our clients, and it's how we best drive sustained growth. So looking forward, our small business strategy centers on three things to leverage that Clover flywheel. We plan to grow more of the front book and back book on Clover.
Our plan is to drive more value-added services through Clover, and we will continue to extend Clover to the long tail of verticals. Those are the three things we're focused on. So I'm going to start on how we scale Clover front and back. I said earlier that we are now at 700,000 merchant outlets today, and that's a 30% CAGR since 2015. There are 4 prongs to our plan to accelerate this trajectory even faster, which will help us grow with new customers and also help us cross-sell our existing client base. First, we've upgraded Clover.com to make it easier for clients to start with us. It's fewer clicks, it's much more intuitive bundles, and it's easier now for customers to check out on their own. Second, we're launching another set of hardware. I'm going to highlight 2 examples to now.
Kiosk for unattended and restaurant use cases, because as we all know, that finding reliable help remains one of the hardest things for small businesses to do. The second one is Compact. This is a new, lower-cost solution that will help us scale to smaller businesses here and around the world. Third, our plan is to win more with larger small businesses. We've expanded our offering to better support multi-location use cases like terminal management and reporting. Finally, our plan is to continue to expand internationally, and I want to talk a little bit more about that.
So when you look at our Clover revenue outside North America, the businesses outside North America account for 10% of Clover's revenue today, but payment volume is growing twice as fast. And as you can see from the slide on the left, we are still early in our journey in scaling Clover in markets like the UK, Germany, and Argentina. On the right is our plan to launch in more markets in the next 24 months, and those markets include very large TAM markets, like Brazil. The second strategic priority is to accelerate our growth in value-added services, and this we plan to do through product-led growth. We're making very strong progress in driving Clover software and services through our new and existing clients.
If you look at our Clover VaaS pen rates, pen rates are now 2.7x higher than they were in 2019, with usage of solutions like Clover Capital up 7x in the same period. Our new Clover dashboard, with upgraded workflows, will make it so much easier for small businesses to select and implement services while they're in their daily routines. So, for example, when a small business grows with their employee base, the dashboard will prompt the owner to automatically add those employees to services like payroll, scheduling, and reporting. Looking forward, one of the many use cases of Generative AI into Clover will be to provide guided merchant help within the dashboard. So product-led growth allows us to deliver the right offerings at the right time to the right customers, which once again unlocks that value of the Clover flywheel.
By the way, there will be a live demo of all of these experiences at the product showcase later this afternoon. So our final strategic priority for small business is how we extend Clover to the long tail. Now, this is a massive TAM, massive. $40 billion or more in verticals that we don't yet play in as well. Here, we serve a range of software partners on Clover today, and we serve them in different ways, from full stack, our turnkey solution, all the way to native, a fully customizable offering. Software partners, as you know, are looking to extend the value of their platforms by enabling omni-channel acceptance and embedding Clover's horizontal services into their experience. And so by enabling Clover for software partners, we can quickly scale into these new verticals, like subscription, government, and education.
This is how we sustain growth with software partners above 30%. So I'm going to shift to enterprise. So very much like small business, enterprise is also a well-diversified portfolio. From an industry perspective, we are well-balanced across nondiscretionary and discretionary categories, and well-balanced in high-growth verticals like digital platforms, marketplaces, and travel. We also see very strong transaction growth around the world. Here's how we think about this business. Historically, you've heard us report on Carat, the enterprise omni-channel client base. These clients represent a mix of customers who have a balance between digital and card-present transactions for use cases like digital wallets, e-commerce, real-time payouts, or buy online, pickup in store. In 2021, Carat omni-channel delivered $450 million in revenue. It's on track now in 2023 full year to deliver about $600 million, and that represents a mid-teen CAGR.
We also serve clients who are more weighted to card present, like those in petrol and grocery. The demand within that client base for omni-channel solutions is growing. What good looks like for us is to scale Carat solutions to all enterprise. It's why we are shifting the KPIs to focus on what matters most to them and to us. First, digital card, not present share, where we are growing transactions in mid-teens today. Second, value-added services, where we already have a 20% pen rate today. And as we extend Carat to all enterprises, we will see growth through those metrics. Let's talk more about the clients, the Carat flywheel of services and how it actually drives growth for enterprise clients. Carat wins in the marketplace for many of the same reasons that Clover does.
It wins because of its breadth of horizontal services that lower the total cost of acceptance and drive growth. It wins because of its range of vertical solutions, like digital wallets and QSR. It wins because of its modular design and global connectivity that allows clients like Caixa and marketplaces to thrive, and it wins because of our associates who are in their client's office every day.... Carat is recognized as a leader by some of the most trusted voices in our industry, including Forrester and TSG. We are fortunate to serve many of the leading brands across verticals, and as you would expect us to say, we're only just getting started. So here is Casey Klyszeiko. He's Head of Carat. He'll explain the power and the potential of the Carat operating system.
Carat is the global commerce platform for our enterprise-sized clients. Our goal is to drive more omni and e-commerce for the world's leading global brands. We've designed Carat to address three of the most important client needs. First, to lower their total cost of acceptance. Second, to optimize their customers' experiences in every interaction, in every channel. And third, to increase the share of their customers' wallet through unique and seamless experiences. Our payment engine is at the core of Carat and surrounded by value-added services, including fraud and security controls, omni-channel tokens and experiences, transaction routing and optimization, and alternative payments enablement. Clients benefit from the scale of our platforms, the modern technology and open architecture, unique insights enabled through unified data across platforms and regions, and a rich set of services enabled through a unified set of APIs. Simplified access points and unified value.
With Carat, we're tapping into high-growth verticals like B2B platforms and software. VaaS penetration and ARPU growth for Fiserv is a natural extension of the success we help our clients find, optimizing every transaction and engaging every customer.
Casey and his team, in collaboration with Guy and the technology organization, are doing a phenomenal job to bring this vision to life. So in enterprise, leveraging the Carat flywheel, we're focused on the same three objectives: add new clients, retain and grow with them, and expand share of wallet. I want to give you some of the proof points that give us conviction. In the last 12 months, we've signed over $250 million in new annual contract value from a variety of large clients across many verticals, like retail, digital platforms, marketplaces, grocery, and petrol. We're winning in value-added services and e-com, with e-com transactions growing in the mid-teens. And finally, an example in petrol, where, as you can see, as we make the shift to software and services, our revenue per transaction is 3.5x greater.
I want to spend a minute now on value-added services in enterprise. As you heard in the video, our clients are focused on optimizing the cost of their operations and lowering the run costs. They're focused on expanding payment choice. They want better data and analytics, and they want to improve the experiences for their customers across all channels. We do these things to help them drive growth. And so for us, value-added services account for about 20% of enterprise's revenue, but they are 30% of new deal signed revenue. And with less than 1% penetration of the enterprise software and services TAM, the upside is substantial. So let me talk about a few examples of how we bring the enterprise clients', experiences to life, and how we leverage Carat, Carat and its flywheel to help drive growth. I'm going to start with Inspire.
Inspire is one of the largest restaurant organizations in the world, with brands like Baskin-Robbins, Sonic, and Dunkin'. It's a privilege to say that we've been in business with Inspire for over 20 years. Inspire uses multiple Carat solutions, many of which play a role in their Dunkin' On-the-Go app that allows consumers to order ahead, gain and use rewards, and pay in-app or in-store. Behind the scenes, we also partner to help Inspire manage operations, and this includes franchise-level support, settlement, and reporting. So across verticals, we've delivered customized solutions such as fraud solutions, data as a service, dealer settlement, and modern gateway routing. I'll shift to grocery to share another example in our partnership with Albertsons, a relationship that spans many years also. We've delivered key innovations, but most notably, a ton of data and analytics that helps them power seamless omni-channel payments for their customers.
Finally, a short example from petrol. We've worked with ExxonMobil to power industry-leading commerce experiences, and what underpins the strength of our relationship is the trust we've built and our commitment to innovation and the global reach we have. So across these three partners, Inspire, Albertsons, and Exxon, we are grateful for their vote of confidence in us and grateful for the long-standing relationships. So let's talk about how we add, retain, and grow, and expand wallet share with our enterprise clients. The story should sound familiar by now. Just like small business, we want to leverage the Carat flywheel to do three things: win more in e-com, expand value-added services by extending Carat to all enterprise, and create more modular Carat services to broaden reach.
Starting with our first strategy, this one is to simplify access points to two important enterprise user bases, our business users and our technical developers. For our business users, such as a treasury analyst or an operations manager, we built Commerce Control Center. The Control Center unifies data with real-time insights, and soon will leverage AI to power intelligent conversations within the dashboard based on the client's exact activity and data. Most enterprise clients are using Control Center. There'll also be a demo of this experience during the day. For developers, we built Commerce Hub. This is a single entryway for modern processing and orchestration to the wealth of Fiserv services. Major clients will begin ramping on Commerce Hub in 2024. Our second priority, grow software and services.
So we offer our clients more than 20 different services, from debit routing to transaction optimization to wallet services, all with varying levels of adoption today. The top end of users consumes almost three times the amount of services that the average customer does. But even at the top end, our pen rates are at less than 50%, which is why we are confident that we can sustain growth. Our final strategic priority is to open the Carat stack to deliver more modular services. You see, on the one hand, clients want to take all our services. We call this full service. On the other hand, some want just specific components to complete their own offering. We call that bring your own. The bring your own model is for clients with more resources dedicated towards customizing their own experiences.
It is this flexibility that enables us to serve a much wider range of clients and to scale and grow. So we've made great progress and are tracking well to the commitments we made about back in 2022 for 2025. It is this progress, along with our growth strategies, that gives us conviction to raise the bar again. So we're raising the bar again. If there were just a few things that I would want you to take away from this discussion, it is this: that we have a great client base and a very well-diversified business, that we have momentum and are winning in higher growth TAMs here and around the world, that our operating systems, Clover and Carat, will expand our software and services adoption, will help us drive growth, and will expand margins. And finally, that we are raising our commitments. Thank you.
Let's hear from another great partner, NYCB.
Our company is a $118 billion bank. We serve consumer and business. My role is the Chief Operating Officer, so I oversee most of all of the banking operations and shared services functions. The technology partner really does need to be forward-thinking, have their finger on the pulse of the market, understanding where other banks are headed, and be able to bring those opportunities to their clients. Our company was at a crossroads. We had a very dated core banking system that was with another provider. Looking at Fiserv and their full suite of offerings, it made a lot of sense to join forces with them, not only for the core conversion, but we took that opportunity to bolster other offerings that we had.
When we purchased Flagstar, it was a very untraditional acquisition, where typically when a bank buys another bank, you take out all of their solutions, and you put in yours. We chose a large percentage of the systems that Flagstar already had. I've got a very solid account executive that runs our, our business, somebody that's available 24/7 and listens to us all the time. We get things done. The company showed a tremendous amount of support to me personally, and their desire to make sure that we're successful as a team. That's all really good stuff when you've got a partner that's willing to call you and tell you: "You know, we will make sure that this is successful." You don't get that every time.
Right from the CEO, to my account exec, I get that level of commitment, and I think that's just a terrific thing.
Please welcome Head of the Financial Institutions Group, John Gibbons.
Good morning, everyone. We appreciate Julie's trust and partnership in helping deliver new cutting-edge solutions for NYCB's valued customers. At our Investor Day three years ago, we spoke about having recently converted NYCB, who at the time had $50 billion in assets. You just heard Julie say they now have $118 billion in assets, and Fiserv has been an important part of their growth. Throughout my remarks today, you're going to hear me tell this story. When we help our clients grow and succeed, we grow and succeed. I'm John Gibbons. After a career in banking, I joined Fiserv in 2018 as head of the Europe, Middle East, and Africa region. Earlier this year, I returned to New York, and I now lead the Financial Institutions Group.
We have financial institution clients of all types and sizes: issuers, credit unions, and fintechs, community, regional, national, and global banks. From the largest to the smallest, they all share a common purpose: to help their customers safeguard, grow, leverage, and move their money. Our solutions bring the latest technology to help them do this, and this is critical because how these clients serve their customers is changing every day. Providing customers with deposits, loans, credit cards, and other banking products is no longer good enough for financial institutions. They must now be able to serve their customers with tailored solutions, delivered how and when those customers want. And that requires not just processing their transactions, but integrating their products and services to give customers easy access to them all when they need it.
It is this single integrated view of a customer's activity that FIs are striving for today, and Fiserv is delivering. To properly reflect this integrated approach, I'm very pleased, along with my colleague, Andrew Gelb, to present our new Financial Solutions business, which you heard Frank preview. This business will bring together assets from our Payments and Network segment with our Financial Technology segment in a way that helps our shared clients better serve their customers. The three business lines under Financial Solutions will be banking, digital payments, and issuing. Each of these has a foundational operating system that supports the processing needs of our financial institution clients. Over the last three years, we've invested in integrating these platforms and value-added solutions, making it easy for our client to buy across our full product suite. Later today, you will hear more from Guy about the technology behind these integrations.
The unique breadth of products that we offer in financial solutions drives trusted relationships with long-term contracts, high recurring revenue, and high revenue retention. Andrew and I are going to talk about some of those products today. We are leading the market because of the assets we have, and we believe bringing them into one business will allow us to extend our lead. Nobody in the market has our starting point. We have achieved these number one successes by understanding the needs of our FI clients and investing in quality and innovation.
With that in mind, we do not only think of our clients as banks, issuers, credit unions, and fintechs, but we also think of our customers as the 1.6 billion card account holders, the 325 million deposit and loan account holders, the 100 million digital pay users, and the 20 million bill pay users that these FIs serve and who rely upon us every day. Focusing on the needs of these end users aligns our offerings with our clients' priorities, and that's why they have and will continue to choose Fiserv. I'm now going to dive deeper into banking and digital payments within the Financial Solutions business. Then Andrew will discuss the key strengths and strategies for issuing. As I mentioned earlier, each of our business lines have foundational platforms.
Within banking, we start with very strong account processing, core platforms designed to meet the needs of financial institutions and fintechs of all different types, sizes, and serving all different customer types. We bring these together with our payments platforms, which uniquely address the needs of consumers and businesses, allowing them to pay and receive money how and when they want. On top of these platforms, we invested in value-added solutions to give FIs and their customers the experiences today's market demands: immediate, digital, easy to use, personalized, and secure. It is with these assets and our continued focus on the needs of consumers and businesses, that we are winning in the market and establishing strong, long-term relationships with a wide range of clients who are purchasing solutions across our business lines. Before we look forward to our growth story, we need to look back.
It all started with the core. Our main strategy has been to win the core relationship and sell other services into it, with an important selling point being that we are a full-service solution, starting with the core and building from there. We love the core because of its interconnectivity and the access it provides to consumers and businesses. It is hugely powerful and will continue to be an important strategy for us. Going forward, we are adding another go-to-market strategy, which we call best of breed. Over the last several years, we've invested heavily so that the quality of our assets will now each win in their own right, allowing us to sell best of breed solutions independent from core relationships. Of course, with the option yet to integrate across Fiserv as well. This best of breed proposition significantly expands our target market.
Now, the strength of our solutions allows us to sell and win beyond our 3,000 core client base, while we also continue to win new core clients. I want to start with banking, the first of the two businesses I will discuss. As you can see here, our revenue mix is roughly 50/50 between core and value-added solutions, with core accounts growing at a lower rate than digital users, which is consistent with the market. The strategies I'm about to review will show you how we will accelerate our account and digital user growth through new core relationships and value-added solutions on the back of the investments we have made and the go-to-market strategies I have discussed. Across Fiserv, our goals are to add new clients, retain and grow with our existing clients, and expand our wallet share with new solutions.
We will continue to grow with our existing clients and open up the larger end of the market with our best of breed strategy. Our value-added solutions will become an increasingly important part of revenue growth, given how they are addressing the key trends of FI customers and what their customers want today: immediate, digital, easy to use, personalized, and secure. Our first strategy: leverage Finxact to open new markets. Finxact, a next-generation system of record platform that we acquired last year, first addresses a key market opportunity for financial institutions to accelerate innovation and enter new markets. Secondly, it further opens up the larger end of the market for us. The technology that powers Finxact is exceptionally reliable, scalable, and highly configurable. Finxact is built in a way that allows for significant customization, which is important to the larger end of the market.
This same technology also enables FIs to quickly enter new markets, launch new solutions, or serve new customers, which their existing core may not allow them to do. Take a look now at how Primis Bank used Finxact to launch a new digital offer to add customers and deposits.
My name is Cody Sheffler. I'm the Chief Information Officer for Primis Bank. One of my tasks has been really to drive digital transformation. We've determined that we want to be a very tech-forward institution. Part of being tech forward is to bring on great technology, and Finxact was our option to be the core to our new technology stack. We want our technology partner to be scalable, so they'll grow with us. We want them to be secure, because obviously we're a bank, and security is really paramount, and we want them to be innovative. When we onboarded Finxact product, one of the most attractive things to us was our ability to grab best of breed products. So some vendors that we didn't have access to with some of our older technologies, we could attach those or bond those or add them to our technology stack.
We took our Finxact core, and we did a little bit of advertising, and it resonated. The combination of a slick account opening process, modern technology, and ease for customers to onboard themselves was highly attractive. So we brought in a little over 13,000 accounts, over $1 billion in new money. It was, it was pretty extraordinary. In 2024, we've got some big goals. Our new digital stack from Fiserv and Finxact presented a great opportunity for us in 2023. We're going to continue down that path and grow our deposits, grow new customers, and we've got some new features and functionalities that we're gonna be rolling out as well. And the Fiserv and Finxact combination allows us to continue to do that.
Primis Bank is a great example of how Finxact quickly addresses the needs of the FI market. I want to move on to strategy two: reignite digital user growth with XD. Our newest digital asset, Experience Digital, is being introduced to the market this year. XD reflects our continued investment in digital banking assets, providing mobile and desktop access to consumers and businesses, and it addresses the same critical trends about which we have spoken: immediate, digital, easy to use, personalized, and secure. Of course, it's integrated with our banking and payments assets, including the features from our CardHub offer, which I will introduce shortly, to provide a full service solution. Consistent with our best of breed strategy, it is core platform agnostic, opening us up to new paths for growth. What does XD do for our clients?
Number one, XD, with its robust features and advanced payment and personalization tools, lets our FI clients go toe-to-toe with any institution and win. Independent research shows XD competes with the digital solutions used by the country's largest banks, who have some of the biggest technology budgets. Number two, it helps our FI clients earn more income from their customers. Our market research shows that digitally engaged customers are more profitable, buy more products, and have more deposits with their financial institutions. I said it before, and I'll say it again, our focus is to help our clients grow and succeed, which allows us to grow and succeed. With that, let me show you XD.
Experience Digital, a unique approach designed to help you deliver the intelligent digital experiences consumers and businesses expect. Experience Digital offers a seamlessly connected ecosystem uniting the very best digital and fintech experiences. Experience Digital includes complementary groups of data-rich intelligent tools and features, what consumers and small businesses want, need, and expect, like opening accounts, managing money and cards, making payments, seeking advice, and tapping into some of the most intuitive and popular small business tools available today. It's time to simplify and integrate your digital financial ecosystem. Increase digital engagement and wallet share, maximize operational efficiency and lower costs with Experience Digital from Fiserv.
I hope you'll take the time to see a live demo of XD during the solution showcase later in the day. Next is strategy number three, data insights to power our clients' growth. There is a compelling connection between our core and digital assets, like XD, when it comes time for our clients to make investment decisions based on their customers' behavior. We are investing in technologies that allow us to access, amalgamate, interpret, and provide important insights to our FI clients to help them make better decisions based on meaningful data. We are in the early days of launching this offer, but have already seen it to be highly valued by our clients. Once again, this offering brings the capabilities and insights of the largest FIs to institutions of all sizes to help them win and to help them compete.
As we move forward with this investment, we expect this to be an important differentiator for our solutions and a unifying factor in why clients choose Fiserv. On to our next business. Digital payments brings together our money movement assets, such as debit network, card, real-time, and bill pay solutions. The revenue model for these businesses is based on transactions, and we win transactions based on our value-added solutions and how they enhance our platforms. That's why we have heavily invested in our value-added solutions, and in particular, focused our investments on customer demands and trends: immediate, digital, easy to use, personalized, and secure. We have three key strategies which will help us to continue to expand our lead in the payment space.... By adding new clients, retaining and growing existing clients, and expanding our wallet share through new solutions.
You will see that each strategy focuses on the important needs of consumers and businesses, and how each strategy can be sold as part of a full-service solution or on its own as part of a best-of-breed approach. Strategy one: deliver the best card experience for our clients. No one knows card processing better than Fiserv. We know what our FI clients need, we know what their customers need, and we have been bringing those solutions to the market. In 2020, we launched Card Expert, a value-added solution providing customer and operational analytics to FIs across debit and credit. In 2021, we launched CardHub, our highly upgraded consumer debit and credit card app on the back of our Ondot acquisition, and we now have nearly 1,200 FI clients using our CardHub capabilities.
Also, in 2021, through another acquisition, we launched SpendTrack, an expense management tool tailored to the needs of small businesses. This year, we brought our digital issuance capabilities from our issuing business into our card business. This enables cardholders faster access to their debit and credit cards via their digital wallet, allowing them to transact before they even get the physical card. And finally, over the course of the last two years, we've been enabling these features within our digital assets so that these propositions are fully integrated with everything we bring to our FI clients. With the introduction of these new features and the other investments we are making, we have successfully been pursuing a best-of-breed strategy and winning card relationships independent of the core.
This also means that when the time comes for our card client to change course, we are in a privileged position to win that mandate, as we saw with the American National Bank of Texas, a card client who recently chose us as their new core provider. In all cases, our FIs are benefiting from the investments we have made and how they positively address changing consumer needs. In particular, let's take a look at the strength of the CardHub asset and the value it provides to our FI clients, as expressed by Central Bank.
My name is Mike Gardner. I'm the Senior Vice President in charge of delivery channels here at Central Bank, based in Lexington, Kentucky. CardHub helps our cardholders engage with our portfolio by giving them their card information at their fingertips. It is integrated with our mobile app, so as soon as they launch their mobile app, they can go right to the cards feature. They have access to pushing the card to the wallet, Apple Wallet, Google Pay. They also have access to the reward redemptions and alerts, and that's, that's really helped them engage self-service very quickly, which is what they're asking for. CardHub has allowed cardholder behavior to be changed by, again, self-service.
Our debit cards are our number one touch point, so CardHub, with our mobile app, allows us to have that interaction with the customer, meaningful conversations around another service that can help them with their day-to-day life with their debit card. Our relationship with Fiserv allows us to compete with bigger FIs, by taking and utilizing Fiserv's, you know, size and technical expertise, and pushing it down to a community bank such as us, to where we can interact with some of the more detailed digital functionality some of the bigger banks have. Fiserv saw a need for a product like this. They reached out to several banks.
I know one of us, us being one of them, asked us what we see in our marketplace, what we need, and with that interaction, Fiserv developed CardHub, which has since now been adopted into our mobile banking. So it's seamless right there. We wouldn't have been able to do that without assistance with Fiserv.
You'll have the chance to see a more comprehensive demo of CardHub during the Live Solution showcase later today. On to strategy two: grow our debit network with financial institutions and merchants. We have the third-largest U.S. debit network due to the strengths we have across our company. Our debit network, first and foremost, benefits from our success in card processing. 80% of our card processing clients, of all types and sizes, also select our network. For this reason, our investment in a best-of-breed card proposition is also an investment in our network. Our debit network also benefits from our merchant business, given its mix of large and small merchants who delegate certain routing decisions to Fiserv. Our merchant business has a particular strength in the grocery and petrol verticals, which are debit-heavy and therefore drive even stronger volumes into our network.
Finally, we have a robust solution that is enabled to compete for transactions across card-present and card-not-present use cases, and paired with our advanced fraud and dispute capabilities, we have created a strong value proposition for both FIs and merchants. This combination of client and capability assets will continue to drive more FIs and merchants into our debit network, bringing more transaction volume and driving more revenue. And finally, strategy three: enable real-time payment transactions and use cases. Our confidence about Fiserv's future success in the growing real-time payments market is built on the strength of our NOW Network. Many of you will have heard us talk about Now in the past, but to remind you, we own this network, and this network is a payments gateway that operates from any core, ours or others, to any payments rail.
You can see on this slide some of the real-time payment options that we enable, and I want to focus on the strength of our position as the number one enabler of Zelle. As a starting point, we have nearly 1,500 FIs on Zelle, 3x greater than the competition, and our transaction growth is almost double the market average. To that, we add the fact that we were the first reseller of Zelle for small business, a feature of the Zelle payment rail, which makes our Zelle proposition even more attractive and gave us a first-mover advantage. These are both great strengths, but there's something even more powerful. Once you are connected to our NOW Network, you can easily get access to any of the other payment rails.
This means all 1,500 FIs that currently work with us on Zelle are perfectly well positioned to satisfy their customers' demand for any real-time payment whenever they are ready to do so. This means we are in a great position to capture that payment flow. When you add this all up, we're confident in the future of our real-time payments business because we have a large client base across Fiserv, we have the capabilities they need, and we make it easy. Later this morning, Suzan and I will show you how this all comes together in helping FIs and small businesses handle payables and receivables. As I get ready to hand this over to Andrew, I want to leave you with a couple of key messages. We have long-term relationships with high recurring revenues.
Our client solutions connect across our entire company, and we believe that is a unique strength. We win because we invest in what consumers and businesses want from their FIs. It's worth saying again, when our clients grow and succeed, we grow and succeed. With that, I'd like you to take a moment and listen to another client we have partnered with deeply, Webster Bank, with over $70 billion in assets. As I said earlier, it doesn't always have to start with the core, and here's a client that began in merchant and has expanded its relationship to include solutions across our banking and payments business.
Webster Bank is a $73 billion asset size bank, headquartered in Stamford, Connecticut. Our footprint stems from New York, Connecticut, Rhode Island, and into Massachusetts. We have also a small, you know, presence in northern New Jersey. I'm the President and COO of Webster Bank. We have a consumer bank, a commercial bank, and we also are the largest bank administrator of health savings accounts in the country. We're pretty evenly split between those three businesses, so we're very well-balanced from a consumer and commercial perspective. We have 850,000, you know, clients. Each one of those 850,000 clients has to be able to transact with us, interact with us, you know, sometimes 24/7. They want reliability. They want client interfaces to be simple and easy to follow.
Fiserv is the infrastructure, nuts and bolts of what we do from a technology perspective here at Webster. Out of our 850,000 client accounts, there is no- not a single one of those accounts that doesn't have, in some way, shape, or form, some Fiserv connectivity. We've been working with Fiserv for a very long period of time. They've been a great partner to us for 10 years. Everything that we've ever asked them to do, they've been able to do it. We just completed a very significant core systems conversion between Webster and Sterling National Bank. Fiserv was actually the Sterling platform, and so this was an uncommon conversion. We worked for 18+ months with Fiserv and the team at Fiserv. I think that we had a small army that was dedicated from a Fiserv perspective.
We've always just felt very comfortable that the ability for us to continue to grow our business, to acquire other banks, to, you know, scale, you know, business lines in the way that we want to, we were going to need a partner that was there and willing to work with us in trying to figure new things out or make things better. Fiserv has been always there to help us out on that journey.
Webster is another great example of the power of Fiserv. Good morning, everyone. I'm thrilled to be here to talk about our winning issuing business and the significant opportunity ahead. I'm Andrew Gelb, and I'm proud to have led Fiserv's issuing business for nearly a decade. Throughout that time, we have rebuilt issuing from a stagnant business on the verge of being sold to an industry leader with a track record of winning and growth. We've achieved this turnaround through investment in our operating systems, new value-added services, performance focus, additional talent, and shedding non-core businesses. Today, I'm gonna talk about how we're going to continue this momentum and extend the success we've delivered since our last Investor Day. Issuing primarily consists of credit processing and the value-added services we provide to large issuer clients around the world.
While a majority of our business is in North America, we have significant share in each international region. The business includes all forms of unsecured credit, such as credit cards, installment loans, and student loans, as well as debit processing in certain markets. In the U.S., nearly all of our issuer clients, as well as most of the client-facing John's business, also look to us to provide statements and plastics. Finally, through our Money Network brand, we manage open loop prepaid card programs for employers and government entities. We also provide other services to the government, including processing electronic tax payments for the Department of Treasury. Given our business, accounts are the primary way we measure growth. In North America, we price by gross active accounts. Internationally, accounts on file tend to be the more common measure.
Our strong account growth on both has been driven by our recent wins and underpins our high single-digit growth rate over the last several years. Fiserv is the number one global provider of credit processing. We have nearly 1.6 billion accounts on file around the world. Our clients are some of the most marquee names in the industry and span the globe. In the United States, they include 26 of the top 50 general purpose issuers and four of the top five retail private label issuers. And as you'll see later, we continue to grow these numbers. Outside the United States, they include 6 of the top 8 in India and 2 of the top 5 in the U.K., among many other markets. I also mentioned our card and statement production business. You can see the numbers on the page.
I like to remind people that personalizing 350 million cards is more than one card for every American adult every year, and 3.5 billion communications basically means that every American receives 10 items from Fiserv every year. The core of our solution set is two strong operating systems, Optis in North America and FirstVision in the rest of the world. Both platforms center around transaction processing and offer a robust set of value-added services. The tight combination and value-added services is the reason why we win. In North America, Optis stands unrivaled in scale, and we are the only major processor that can integrate credit, debit, and loan processing on a single platform. Optis also has a wide variety of value-added service offerings that power our clients' businesses. FirstVision is our international platform and can be deployed in both onshore and offshore environments.
The system is multicurrency, multilanguage, and cloud-ready, allowing us to deliver flexibility around the globe. At our last Investor Day, I presented this slide illustrating our $120 million of wins in 2020. It was a record-breaking sales year, clearly demonstrating the strength of our business and our ability to win against the competition. Now, three years later, we actually achieved $150 million in revenue from these wins, 25% greater than originally projected, and there's more opportunity still ahead. A significant component of the higher revenue is due to our executing our strategy to add value-added services, along with statements and plastics. I'm proud to have Jeff Howard, the CEO of Atlanticus, one of the clients we won in 2020, on video to talk about his experience with Fiserv.
I'm Jeff Howard. I'm the President and CEO of Atlanticus Holdings. Atlanticus is a financial services firm that partners with banks and retail providers and healthcare partners to enable them to offer more inclusive financial services. Our purpose is to empower better financial outcomes for everyday Americans, and by everyday Americans, we typically serve customers who are living paycheck to paycheck. When you add all those together, we serve about 3 million customers. Yeah, so when we selected Fiserv, after an extensive RFP process, we moved from a system of record provider that had been our partner for 25 years. Overwhelmingly, it was Fiserv's approach to partnership that gave us the comfort that they were gonna be there for us long term. ...When we look to partner with technology providers, we expect three things. One is the technology has to work, right?
24 hours a day, seven days a week, 365 days a year, no exception. Two, given the industry that we serve, it has to enable a compliant solution. And thirdly, is we look for forward-thinking partners, partners who are willing to invest in their technology so that they can bring to us a best-in-class solutions, and Fiserv has done that across all three in spades. The last three years, we've seen great opportunity in our market, and we've had the infrastructure, the scalability, the reliability that comes with partners like Fiserv to enable us to do that. We're constantly innovating and looking for ways to bring more value to our retail partners, our bank partners, and our healthcare partners.
We have a number of new product innovations that are on our roadmap for the early part of 2024, and Fiserv has been integral in helping us establish the criteria, and the requirements for the launching of those products and helping us take them from the whiteboard into commercial reality.
We're proud to partner with Atlanticus, and we value our relationship. Under Jeff's leadership, Atlanticus was recently named to the Fortune 100 fastest growing companies list for the third consecutive year. Now, in 2023, we've done it again and signed over $125 million in new client wins in the last 12 months. This will underpin our growth rate for the next several years, like you saw from the 2020 wins. As you know, implementation timelines for these major wins can vary, so all the revenue will not come at once. I'd like to talk about two of these clients in particular. Target is an industry icon, and we're so pleased they chose to switch to Fiserv. This further demonstrates our leadership in the retail processing space. Target chose Fiserv for our proven scale and the elevated digital experiences our solutions create for cardholders.
Desjardins may not be a household name to many Americans, but it's the fourth largest issuer and the largest financial cooperative in Canada. It's our first major Canadian client and a game changer for us in that market. We're thrilled to be working with all of these clients. Most of them are new to Fiserv, so issuing is also acting as an entry point to broader Fiserv relationships, which speaks to our business model. Of course, we're far from finished. We have a robust pipeline of additional deals, and we're poised to keep the growth going. As we look towards the future, our strategy is, in many ways, a continuation of what we're already doing. As you can see, we have four key strategies. First, we're accelerating our investments in next-gen technology for both Optis and FirstVision to extend our lead with modern card issuing.
Second, we're expanding our footprint in new international markets. Third, we're leveraging and continuing to add value-added services. And fourth, we're deploying our issuing assets in newer verticals such as government, healthcare, and point-of-sale financing. As you've seen today, our unrivaled scale and expertise set us apart from our competitors. We're now applying our expertise to extend our lead with modern card issuing. We're investing over $200 million in FirstVision and Optis to deliver cloud-native versions of each. Fiserv is unique in our ability to make such a significant investment, along with the know-how to deploy it in a way that accelerates our clients' growth, enabling them to build more and build it faster. In particular, we're focused on simplified APIs and microservices, cloud-native development, real-time processing, and event streaming, among other design principles.
These technologies will allow issuers to move faster, redefine cardholder experiences, and better leverage data. As our clients grow, so will our business. We'll expand our TAM by appealing to issuers in new ways. We'll deliver internal efficiencies by lowering our cost base with a newer technology stack, and we'll unlock new monetization opportunities with our data strategy and services model. Guy will also talk about how this sort of technological innovation remains at the forefront of our objectives across Fiserv. One aspect of our technology transformation of particular note is the opportunity created outside of North America. Although FirstVision is already cloud-enabled, we're developing a cloud-native version of FirstVision, which will allow us to better tap this opportunity. Fiserv has traditional strengths in Europe, India, Singapore, Australia, and Colombia.
But as the slide shows, there is substantial opportunity in other markets, many of which now require onshore processing. To start, we've already deployed FirstVision in the cloud in Brazil. As we launch our cloud-native applications, we'll be able to further penetrate these markets, as well as appeal to banks looking for modern alternatives to their legacy in-house processing systems. We see $500 million of opportunity in these new focus markets, as well as further demand in our traditional markets as banks look for better ways to compete. I've mentioned value-added services several times throughout this presentation. Issuers spend hundreds of millions of dollars on VaaS every year. Our robust set of solutions allows us to move up the value chain directly into the cardholder and servicing journey.
For example, in the last few years, we developed a new fraud and risk management tool with artificial intelligence called Advanced Defense. With machine learning and advanced analytics, Advanced Defense has been shown to reduce fraud losses by 10% per fraud case while reducing false positives by 40%. This kind of improvement has brought significantly more value to our clients. As you can see, we've penetrated over 50% of our client base over the last few years, and I expect we'll see most clients deploy it in the next few years. We've also invested heavily in digital cardholder experiences. We developed a leading web and mobile-based solution, in part leveraging Ondot, that increases our cross-sell opportunities. Issuers are able to deploy our full solution or leverage our APIs to enable the experience elements they choose through their own channels.
We already have more than 50 million cardholders using these solutions and expect further penetration as we continue to invest. In the loyalty space, we have built a brand-new, fully customizable platform. This solution is already operating at scale, with more opportunities for further growth and monetization, such as Pay with Points and card-linked offers. Of course, this is just a partial list, and we're continuing to invest in tools that allow our clients to do more. For example, we're now working on an integrated disputes workspace and a digital client communication hub. All of these tools will allow us to capture more of the $250 million incremental opportunity in North America, not including the considerable international market. Now, to bring our VaaS to life, I'm gonna share a brief video showcasing our Advanced Defense solution.
It's a global marketplace. Cardholders can purchase coffee in Costa Rica from their couch in Costa Mesa or Kalamazoo. What if those coffee bean purchases aren't actually from cardholders? What if that coffee roaster in Costa Rica is the victim of a merchant takeover event? When that happens, thousands of cardholders could be affected. Advanced Defense from Fiserv helps protect both issuers and cardholders from potential fraud. Using a powerful combination of cognitive AI, integrated analytics, and enriched data, Advanced Defense monitors spend across the card issuer's entire card portfolio. When suspicious activity occurs, like a major spike in coffee bean sales at 2:00 A.M., Advanced Defense alerts the issuer to an attack and immediately takes action to block activity, decreasing potential fraud losses.
The system then uses cognitive AI to understand preferences for detection, identify suspicious activity, and recommend new monitoring rules, all customized to suit each issuer's specific needs. The result? A proactive, highly enriched fraud strategy that minimizes potential fraud while maximizing legitimate cardholder spend. Advanced Defense from Fiserv.
Pretty cool. Advanced Defense is a great example of marrying AI capabilities and our data. The final piece of our strategy is new verticals. Today, I'd like to share three examples of where we're identifying reusable assets and expanding into adjacent businesses. First, government. Over the last few years, we have successfully sold our prepaid solution to federal, state, and local governments as a disbursement tool. For example, we've issued prepaid cards for major one-time use cases, such as the COVID federal stimulus and the middle class, California Middle Class Tax Relief program. The opportunity is significant when you take into account the federal government, the 50 states, and municipalities around the country. Second, point-of-sale financing. As the buy now, pay later market matures, banks are well positioned to establish themselves in this space.
Enabling this service is consistent with our overarching strategy to support financial institution clients and not to compete with them. Within issuing, we've partnered with our clients to successfully launch more than five new POS financing programs since the end of 2021. You should expect us to build upon our early success in this space with both FIs and directly with our merchant partners. The healthcare vertical also offers significant opportunities. The Optis platform specifically supports the cards associated with HSA and FSA accounts, and there are numerous opportunities for statements and card production within healthcare. We've implemented five new healthcare portfolios in the last several years and are in the process of onboarding more. In particular, healthcare clients will leverage our strong set of digital tools, which are not typically found on healthcare-specific platforms.
So you've heard from both John and me about how we're gonna grow with financial institution clients. Our momentum is strong, and our strategy is clear. We're the global market leader in issuing and have a proven track record of success. We're onboarding more than $125 million in new mandates, and our pipeline continues to grow.... We're investing in Optis and FirstVision to cement our industry-leading position and unlock new revenue opportunities. We're leveraging our platform investments to expand globally. We're continuing to commercialize value-added services to earn more revenue per account, and we have significant opportunity to penetrate new verticals with existing issuing assets. Thank you. Next, we'll take a short break.
Please enjoy your break. We'll resume again at 10:50, 10:50. Thank you.
Please welcome back, Frank Bisignano!
How was that exhaustive break? Good. Welcome back. The next session is one we could not have done four years ago. This is where we are going to share specific examples of how we operate across Fiserv to bring merchant, payments, and account processing products to both merchants and financial institution clients. You're going to hear three great examples of cross-organizational solutions that are unparalleled. The first and newest solution, SMB AR AP, where we're partnering with Melio for the front end and leveraging assets and knowledge and know-how from our consumer bill pay business, which remains the industry leader. Then we'll move on to embedded finance. As I mentioned, we have been sitting at the intersection, providing bank services to non-banks like merchants for a long time.
The idea is moving more mainstream now, and we believe we come to market here from a position of strength, given our experience. And finally, we'll share a case study about decades-long relationship with Walmart, which has grown to include many products across our merchant, payments, and banking solutions. As you're about to see, no other company operates in between merchants, financial institutions, and their customers the way we do at Fiserv. So let me bring out Suzan, John, and Andrew, because together, they are collaborating to make sure Fiserv stays at the forefront of these opportunities. Thanks, guys.
Thank you, Frank. So small businesses are the backbone of communities and economies around the world. John and I are here to talk about a strategy to help small businesses better manage cash flow. Some context before we go deeper. In the U.S., there are 34 million small businesses. That's over 90% of the businesses in this country. They drive 40% of the U.S. GDP, and they are half of the workforce. One more notable factor that's important about these businesses is that bank lending to them last year, banks approved about 500,000 more new small business loans. So small businesses are critical to communities, to banks, and to businesses like Fiserv. But as we know, it's really tough to be a small business. It's become so much more expensive for them to run, fund, and grow their businesses.
There's a ton of friction in every task they do, whether that's just managing people to work for them, serving their customers, or managing cash flow. It's one of the reasons we are investing in the automation of AR. And we believe that by bringing together our banking and our Clover assets, we will automate these important tasks and give small businesses back time to focus on growth. Here are some of the problem statements that led us down this path. The market remains very fragmented. Two-thirds of businesses have to go beyond the bank to meet at least one of their cash flow needs. There is no complete offering for end-to-end cash flow management. The majority of businesses use up to four different providers, and it's really time-intensive, not sensitive.
An independent survey of small businesses reported that it can take more than 18 hours a week to manage cash flow. That's a lot of time, time they just don't have. So the more friction, the more it costs small businesses. So I'm gonna turn to John to take us through the solution we are launching called Cash Flow Central. John?
Thank you, Suzan. In partnership with Melio, which we announced last month, we are building Cash Flow Central, which will combine the easy-to-use accounts payable and receivable workflows for Melio with Fiserv's bill pay, merchant network, and payment capabilities. It is a single operating system that helps small businesses manage their full financial picture all in one place. Cash Flow Central consolidates and streamlines the payments processes for small businesses. Namely, it gives them the ability to send invoices, instantly get paid, manage approvals, pay both billers and suppliers, using either a bank account or a credit card, and sync with their accounting software, all with best-in-class workflows, all with best-in-class technology. This new functionality can be accessed through any mobile or online banking experience, like XD, which I talked about earlier today, or through the Clover dashboard, which Suzan covered.
It will also be made available to the more than 3,500 FIs that currently use our bill pay solution. For the small business, Cash Flow Central saves time, money, and cost, and with future cash flow projections, it also helps the business optimize their cash. I wanna talk about what this means for our financial institution clients and for Fiserv. The attainable revenue is significant in this space, and the demand is real. For financial institutions, Cash Flow Central empowers them to serve and grow their small businesses, protecting and expanding deposits, attracting new customers to their franchise, and increasing stickiness. In one use case, we found that Cash Flow Central creates a new recurring revenue stream for the FI, which we estimate at $1,200 per small business per year. Using Cash Flow Central, we believe financial institutions can win in B2B payments.
For Fiserv, we can extend our lead with this best-in-class accounts payable and receivable solution, retain and grow our FI client base, acquire new SMB merchants, and expand our share in this important market. We believe this represents a midterm TAM of about $2 billion, which is why we're excited to present it to you today, and why we look forward to sharing updates on our progress in the future. And now, Andrew and Suzan are gonna talk about the power of Fiserv coming together in embedded finance.
As you've heard throughout the day, Fiserv operating systems are delivering unmatched value to our financial and merchant clients. embedded finance is an example of how we've been integrating these operating systems to link banking, credit, and payment services into the growing commerce ecosystem. For the next few minutes, we'll share a bit more about how we define embedded finance, how we're approaching the space, and why we have conviction in our ability to win. embedded finance is about deploying personalized financial experiences anywhere and everywhere... merchants, software partners, and private label issuers all need solutions to serve consumers and small businesses. Financial institutions see opportunity in connecting to this ecosystem. embedded finance is not a new concept, and as Frank noted earlier, Fiserv has enabled use cases for years.
Now, more banking and payment transactions are being initiated in commerce journeys, and the lines between payment processing and banking are blurring. Fiserv is uniquely positioned to win as a provider of embedded finance. As the largest provider of merchant acquiring and core and issuer processing, Fiserv has the most complete set of assets to deliver embedded finance. In merchant, Commerce Hub is unifying access to merchant services and our VaaS distribution network. In financial services, Finxact delivers a modern ledger capability and is connected to the Banking Hub, which extends its access to thousands of financial institutions. In card issuing, Optis is the industry's premier credit platform with 80% of the private label market. Now we're working to deliver all of our services through unified APIs rather than discrete integrations.
Unified APIs will provide our clients faster time to market, less operational complexity, and more value in one place. Payment acceptance, stored value, and rewards are all available via unified entry points today. Finxact will enable checking accounts and debit cards to be integrated in the first half of 2024, and we'll add the lending capabilities from Optis later in the year. I'm gonna take you through an experience we can enable for a large retailer. Suzan will then walk you through an example with a software provider. When consumers shop at retailers, they often have multiple sources of value, including credit cards, debit cards, gift cards, and reward points. However, most consumers have no easy way to aggregate the value that's trapped across multiple products. With Finxact, we can enable them to combine payment types into a single transaction.
For our retailer clients, we can also enable them to issue the underlying gift cards, credit cards, and rewards points, and benefit from higher cart conversion and basket size. Let me describe a specific example here on the page. This shopper can complete a purchase for $100 in a single transaction using $60 from her gift card, $30 from her loyalty points, and her credit card for the remaining $10. Aggregated balances and split tender transactions unlock more value for consumers and retailers. Suzan?
Thanks. So let me shift to a software partner example. Software partners are seeking more ways to serve customer needs, and they're turning to financial services to extend their offering. As an example, this is a software platform that enables interior designers to share design plans and furniture catalogs, deliver project updates, accept payments, and extend financing all in one place. Embedded finance gives the consumer access to capital as she's planning for her upcoming payments. It enables the designer to run their business on one platform so they can focus their efforts on their client's vision. It empowers the software partner to provide value to their designers while enabling greater cash flow efficiency, meeting them where they are. And it gives the financial institution an opportunity to underwrite loans via new channels. So let's hear from Brad Hoeweler. He's the CEO and cofounder of Pay Theory.
It's a software partner for the long-tail verticals.
I'm Brad Hoeweler, co-founder and CEO of Pay Theory. We are an inclusive, embedded payments and finance infrastructure company. We really set out to enable businesses and must-pay sectors to allow their consumers to pay when, where, and how they need to pay. Our customers are the software platforms and the merchants in verticals like education, healthcare, care services, government, and insurance. There's access to every feature functionality that one would need to accept payments, right? Pay ins, move funds out, do it on a variety of different rails, working with the team of Fiserv to dive in, evolve, grow, and do it in a very cooperative way. We are looking to partner, you know, very closely with Fiserv to bring that next generation of embedded payments plus embedded finance, bringing, you know, basically a convergence of those technologies.
I think that 2024 is really gonna be the starting point, and I think that it's gonna be a very exciting year.
So Brad is one of many software partners who are increasingly turning to embedded finance to extend their services and to help their customers grow. It's not just software partners that are demanding embedded finance services. We're seeing this demand from many Fiserv customers across the company, from large merchants looking to build out their mobile apps and enhance consumer experiences to issuers in Andrew's business who are looking for greater wallet share, all the way to financial institutions in John's business, who are looking to grow deposits and expand revenue streams. Fiserv has a unique set of assets and client relationships across the company that position us really well to win.
The TAM within our client base alone is more than $2 billion, and with a growing number of wins with some of the world's largest retailers, we have strong conviction in the potential of these services. So Andrew, John, and I look forward to sharing more of our success over time. So onto our third example, we're going to shift to a large partner, Walmart, and how the three of us and our teams are working to unlock value.
As Frank noted earlier, at Fiserv, we're proud to say that we touch nearly 100% of households in the U.S. With 90% of the U.S. population living within 10 miles of a Walmart store, and with one of the fastest-growing and most dynamic e-commerce organizations, Walmart is critical to the world around us. Walmart is at the very forefront of omni-channel commerce, allowing their members and customers to shop when and how they choose, whether that's in one of their 10,500 stores or through digital channels, such as walmart.com and the Walmart app. For the past 27 years, Fiserv has been a Walmart partner in their expansion to become the world's largest retailer. The scale of our partnership is unique, both here and across borders. Fiserv has grown from being an in-store acquirer in 1996 to a full omni-channel partner in 2023.
Our services are integrated throughout Walmart's channels in many of those same ways we discussed in embedded finance. So let's talk about how Fiserv supports Walmart today. Speaking for my business, since 2009, more than 3 million Walmart associates have received their payroll through an Exceed card. Exceed is the prepaid card delivered by Money Network as an alternative to checks for associates who may not have checking accounts. In partnership with Synchrony, Fiserv has also provided full end-to-end support for the Sam's Club Mastercard and private label credit card using the Optis platform. Let me turn to Suzan to talk about Walmart and merchant.
Thank you, Andrew. So leveraging Carat, we enable Walmart to run their business more efficiently through our payment optimization and least cost routing services. And our digital disbursements platform provides payouts for various businesses across Walmart. Carat's omni-channel wallet integrates our stored value capabilities into the Walmart app. In 1997, Walmart launched our gift solutions for physical gift cards and has since expanded globally. In more recent years, our collaboration on gift solutions has expanded to include digital rewards and Walmart digital wallets. Other parts of Walmart, including Sam's Club Membership Rewards and Mexico's Cashi digital wallet, are all supported through our gift platform. Additionally, Walmart was a pioneer of our pin-on-glass technology to support EBT cardholders' online access to government benefits. Now, as you've heard, over the years, Walmart and Fiserv have repeatedly innovated together.
Just as customer shopping habits have moved across channels, so has Fiserv technology. We enable new and differentiated omni-channel customer experiences for Walmart every day, including a rewards program within a single omni-channel wallet earlier this year. Following its success with Walmart+ members, they've expanded the program to all customers. Now, all Walmart shoppers can discover and clip coupons, collect a range of stored value, including rewards and travel benefits, redeem Walmart Cash towards future purchases, or cash out into a one debit account across all channels. Fiserv technology underpins the orchestration of all these services. We connect and update the multiple products involved in real time and enable split tender purchases, redemptions, and returns. So over to you, John.
To round out our relationship picture with Walmart, in payments, Fiserv has provided debit routing through our Star and Accel networks for over 20 years. Fiserv is also excited about the future of ONE, the fintech startup created by Walmart last year, which is powered by Finxact, our next generation core. The ONE app is offered in Walmart's physical and digital channels, extending financial services to the retail giant's 1.6 million associates and over 100 million-plus weekly shoppers. Walmart is just one example of the many companies using multiple Fiserv solutions, leveraging the full power of Fiserv. Our unique suite of solutions enables Fiserv to meet the ever-changing needs of our clients, all segments and all sizes. This is our differentiator.
And now, we'll welcome back Julie for the business Q&A.
Thanks, John. We're going to get some chairs out here. Thanks, everyone, for bearing with us. We're running a little bit behind time, but we'll have, we'll have plenty of time to catch up. Some Q&A now with our business unit leaders. Some rules of the road on Q&A. I'll ask everyone to stick to just one question so we have a chance to get to as many questions as we can. If you have a question, please raise your hand. Someone will come by with a mic. It would be helpful if you would say your name and company before asking your question, and we'll get started in just a minute. It's a long way.
There we go.
All right, all settled. Yes, Harshita.
Thank you. This is Harshita Rawat from Bernstein. Thank you so much for the presentation today. Suzan, can you talk about Clover's back book conversion opportunity? What determines the pace at which you can do that, and how much of the back book is truly addressable by Clover? Thank you.
Thank you for the question. So it's always good to start with context. As you saw, both merchants with Clover and merchants without Clover are growing, growing fast. The ones with Clover are growing faster, which says there's something good about the value proposition, the stickiness, and the ability for them to consume services. In our original assumptions that led us to the $10 billion and the $3.5 billion for Clover, we had very moderate assumptions for back book conversions, not because we aren't focused on it, but we just didn't include it since we're focused on building accretive portfolios to the company. We are now very focused on the way forward because what you saw in my presentation showed that we have a range of ways of serving customers on Clover.
So whether it's the full stack or the native integration, what we're doing is stretching the way we serve to give long-tail vertical players the ability to take Clover to market, as well as the core book of business. That is our direct book. That is a full service offering. It is that range that gives us more confidence now that we have a structural and systemic way of growing both the front book to new sectors, large and small, and the back book, where it makes sense for those merchants to adopt Clover. But both segments continue to grow well, so we're going to focus on growing every share we can, front and back.
David?
Thank you. David Togut with Evercore ISI. Suzan, could you talk about the rollout plan for kitchen display system through Clover over the next 12 months? How big is this opportunity? What's the go-to-market approach?
So thank you for the question. You saw in the presentation that our focus verticals, restaurant, retail, and services, growing mid-double digits today, growing both on our Clover base and our non-Clover base. I also talked you through the example with Feeney, a customer that uses an extended range of services. KDS, which you'll see on display at during the demo, is due to launch in the first half of 2024. We expect that it will be one of several offerings that help us grow with larger restaurants, in particular, which is our focus segment. But you saw already that with large restaurants, we're growing again in the low mid-teens, and that's before we actually extend the stack all the way to their full potential. So KDS is one of several solutions.
We have now integrated best of breed from across Bento and Clover, where we have website development, a new online ordering handle, KDS, catering, and a number of other services, all designed around small and very tall restaurants. So we're excited. Thank you for the question.
Yes, let's go to Kartik.
Hi, Kartik Mehta with North Coast Research. Suzan, you talked about one of the key advantages Fiserv has is its distribution system, especially on the merchant side. So if you look at all your distribution, you know, bank partners, value-added resellers, direct sales, how would you cut them up? You know, what percentage comes from bank partners, what percentage comes from value-added resellers and so forth?
I probably won't spend as much time, Kartik, making you happy with the math around what portion comes from which, but I will tell you that we value all of them equally. Each channel, whether it is through a partner or through our direct channel, brings a different value proposition. In our direct channels, what we like to think is that we have not just the ability to sell them and manage them and serve them and grow with them. Through our distribution partners, the value they bring is they give us the ability to scale in our long tail, and software partners are a great example of how we are unlocking the long tail.
We get to these segments where we have perhaps less specialty, less investment, but we get there through them leveraging their software stacks, and over time, as we've done historically, we look at different ways to partner with them strategically. And from time to time, I think a question that you can throw to Bob, we look at whether the capital allocation calls for us to think of them acquisitively. So every channel has value, the economics differ, but we do not in any way choose one over the other. They all bring scale, reach, range, and value accretively to merchants.
Yes, Dave. That Dave can't see so well there, David.
Hey, thanks, guys. Dave Koning at Baird. So two-part question. First of all, value-added services seems like a big driver of growth. Is that less macro-sensitive? Is that priced differently than volume-based, first of all? And then secondly, issuing, is that just credit? And if so, where does debit fall now?
So, I mean, speaking from my business specifically, you know, I would say value-added services is on a different cycle than account growth in general. You know, many value-added services are priced by account, but our ability to sell value-added services, you know, should act on a different curve than account growth per se. You know, our issuing business as we define it, is mainly large credit. You know, debit would fall in the John area. There are some common platforms in some cases between each. But by and large, that's how we go to market.
So I would say, if I may, thanks for the question. I would say, so we do have the debit platform within our business, and we do have a credit business as well, and the good news is we use Andrew's platforms to deliver the credit into our financial institution customers. From a value-added service point of view, largely transaction-based, and one of the things that we love about the value-added services that, that we spoke about today was they're all very much feeding into the trends in the industry, right?
About how consumers and how businesses want to transact, how they want to move their money, how they want to look at their money, and therefore we think the growth trajectory of them are phenomenal, which is why we're so excited about it within the Financial Solutions group and in the FIG business in particular, where we talk about the fact that it will become an increasingly important revenue contributor as time goes on.
How about Jason behind?
Jason Kupferberg from Bank of America. I just had a two-part question on Clover. The first one is, which parts of the growth equation do you think are most likely to drive the incremental acceleration we need to see between now and 2025 to get to that $3.5 billion number? And then the second part, just building on the back book question is, are we saying that now the 2025 target does include some meaningful contribution from back book or not? Thank you.
Let me make sure I answer the second one-
Okay.
No, on the second question. So the 2025 $10 billion did not include back book conversion at any degree of scale. On the first, if you look at our results through the third quarter this year, we're tracking at a 26% growth rate. So we are within reach of the original assumptions of growing above 27%. We never said it would be the same. We said you would see acceleration as the flywheel began to take effect. Our front book is consuming services at a much faster pace. Our back book is beginning to convert, but it is converting to services that are accretive. So we're as confident as we were when we set the first expectations, which is why we're raising the bar on the $10 billion and also setting a new hurdle for 2026 at $12 billion overall.
I will take one more if it's on Financial Solutions and not on merchants. Tien-tsin.
Yes, Tien-tsin from JP Morgan, just on financial solutions, think about issuing, I guess, in general, if that's okay. Just with the $200 million investment, I just want to make sure I understood. Is that to promote a better opportunity around going after some of these new use cases like virtual card processing and commercial credit, targeting suppliers, that kind of thing? Is it more around value-added service? I know early wage access and powering marketplaces. Seems like there's a lot of growth there with some of the modern players are going after.
Yeah, and I think, I think, you know, your, your question includes the answer in a way. I mean, absolutely, you know, we're trying to target with the investment, some of those modern card issuing experiences, that we've probably focused on a little bit less, up till now. That said, you know, it should be clear that our current technology platforms are very strong, and we continue to win in the market with our current technology platforms. So it's about enabling more use cases. You mentioned virtual, data, real-time, et cetera, and those will be the areas we expand in with the investment.
Okay, that's all the time we have for questions now. There'll be plenty of opportunities throughout the day to ask more. So you can go take your seats, and we're going to get started with Guy. Our COO, Guy Chiarello, is someone I've known for a couple of decades as a great technologist, and I think who many of you know as really a luminary in financial services IT. So very pleased to bring up our COO, Guy Chiarello.
Thank you, Julie. Thank you, Julie. And great job by the team. Very proud of you, always. I hope you get a feel that we've been very busy, and, and I hope you've enjoyed the morning so far and find this session informative and exciting. So far, we've spent the morning talking about the what in our vision. Now, I'd like to spend some time talking about the how. I want to stress the importance of the investments we've made to bring us to where we are today. The execution of our innovation agenda makes us an industry leader, and I will share how we're extending that lead.... Every day, we strive to deliver superior value for our clients through leading technology, targeted innovation, and excellence in everything we do. We execute our platform strategies, drive digital growth, and deliver transformative experiences.
We remember that we are in the business of enabling our clients' success. The last time we were together, although virtually, I emphasized how Fiserv has expanded our leadership position in the commerce and fintech ecosystem. We have continued to strengthen and scale our global platforms, powering, as Frank said, over 25,000 financial transactions per second, enabling us to deliver for millions of clients around the world. And as you heard from my colleagues, we aren't stopping there and have set targets for even loftier goals. I'd like to share a short video with you that highlights our accelerated momentum and innovation. What you just saw are over 16,000 technologists, global innovation hubs, strategic acquisitions, and billions of dollars of annual investment. These are just some of the building blocks that will allow Fiserv to continue as a leader.
Now, I think of Fiserv as a four-year-old company. A four-year-old company with a 40-year advantage. Whether during my time leading technology at JP Morgan Chase through the dotcom era, navigating JP Morgan Chase through the years after the financial crisis, or even transforming First Data through the digital payments revolution, I'm telling you, the current pace of innovation at Fiserv is unprecedented. As you heard from all three business leaders, we've evolved from a seller of point solutions to a provider of business operating systems, enabling digital ecosystem, digital ecosystems of integrated solutions and value-added services. Fiserv is uniquely positioned to execute this transformation because of our scale technologists, breadth of solutions, and investment capacity. Clover is a great example. From the moment it was acquired, we've been driving its transformation into a market leader. We built an innovation blueprint that has proven hugely successful.
These business operating systems are built on three core principles. First, modern processing environments to enable scale, resiliency, and flexibility. Post-merger, we've closed over 40 data centers and have committed nearly $1 billion over the next five years to capitalize on the latest cloud technology. We recently signed long-term partnerships with three cloud providers, positioning us well for continued growth. Second, omni-channel and digital-first solutions focused on new commerce and banking experiences. Across physical, online, and mobile channels, our technologists are powering unique customer journeys. And third, open and flexible ecosystems built upon microservices and APIs. This approach brings everything together to deliver industry-leading capabilities for our clients. These transformation programs ensure that Fiserv will remain on the cutting edge of payments and fintech innovation. Let's go back to Clover, our end-to-end business operating system for small businesses.
What started as a vision with little more than seven engineers has evolved into a leading global brand. As you heard from both Suzan and Frank, even with over $270 billion in annualized GPV, Clover is still early in its growth. The success is powered by an open, cloud-native core, a new orchestration layer in Clover Gateway, and a modern architecture allowing for rapid integration of acquisitions. We have continuously executed on a high-quality robust hardware roadmap, beginning with state-of-the-art devices to the market. In parallel, we have enabled support for various digital interfaces across online and mobile. When you combine Clover's market-leading functionality with our scale, distribution, and investment capability, you have a winning formula.
For the enterprise clients, we have Carat, our global omni-commerce platform that enables leading brands to meet their customers where they want to transact, whether that's in their mobile app, online, or in store. We have invested heavily into rearchitecting our platforms, consolidating into go-forward systems, and building a single entry point called Commerce Hub. Commerce Hub, with its omni-channel payments orchestration, provides leading capabilities with ultimate flexibility across e-commerce, alternative payments, and multi-acquirer scenarios, just to name a few. Taking advantage of cloud delivery and API connectivity, we've built a truly modern and open ecosystem for commerce. Let's switch gears and talk about exciting innovations we are delivering for financial institution clients. For several years now, we've been on a major transformation journey. As you heard from John, we can now decouple our cores from our digital solutions like XD.
We are consolidating into next-generation systems like DNA, and we have enabled capabilities in the cloud like we did for Portico. We have evolved from a core provider to a best-of-breed financial services enabler. Major investments over the last three years have enabled us to deliver real-time functionality, new digital experiences, and data-powered insights. The Finxact acquisition has been a huge catalyst here, too. Finxact does not replace our core strategy, but rather it accelerates and transforms it. With Finxact, we are rapidly deploying new features to supplement existing core functionality. Digital-only institutions and fintechs can now expand their customer relationships. We can even bring in commerce solutions by connecting with Carat. The combinations are truly limitless. Our investments and our acquisitions are coming together to future-proof our clients. For issuer clients globally, Optis and FirstVision continue to be industry-leading and fast-growing platforms.
For years now, we've had comprehensive solutions for issuers across payments, loyalty, fraud, and more. And Tien-tsin, to your question, the Optis and FirstVision platforms, running on the newest versions of mainframe technologies, are resilient, powerful, and highly scalable. Having said that, as you heard from Andrew, this year we began a significant rearchitecture initiative that will revolutionize the issuer processing business. With these next-generation platforms, we're enabling new cardholder journeys through cloud-native technologies, simplified APIs, value-added services, real-time processing, and event streaming. I hope it's becoming clear. We took the Clover innovation blueprint, and we are now enabling business operating systems across the company. The depth and breadth of Fiserv's offerings are second to none, and will continue to elevate us in the marketplace.
Now, we know that providing clients with flexibility and control is paramount, so that's why we have simplified and continue to simplify the integration and data-sharing experience. Fiserv's award-winning Developer Studio is a platform that empowers engineering teams with comprehensive tools to experience the full Fiserv. With DevStudio, we offer a new developer experience, an API explorer that enables real-time edits, digital guides, credential management, and even AI-powered code generation. With Commerce Hub, we provide a unified set of always-on APIs. Its orchestration layer enables seamless access to the full omni-channel power of Carat. We then brought this same ingenuity to Banking Hub, a single location to access Fiserv's banking APIs. And while we've built streamlined access to Finxact, we have also enabled developers to build and test directly with all of our existing banking cores.
More recently, we integrated new APIs to enable embedded finance, opening the door to truly special banking, acquiring, and credit-as-a-service experiences. Now, among our greatest assets, Fiserv manages one of the most valuable information bases. With billions of transactions and information representing millions of commercial entities and nearly all U.S. households, we are delivering increased intelligence to help our clients and communities in many ways. Clover Dashboard, Commerce Control Center, and Data Cloud for FIs are great examples of us putting data to work for clients, enabling them to build benchmarks to assess the health of their businesses and make quicker, fact-based decisions.... Because Fiserv spans the full client relationship from entry point to back-end processing, we are assertively bringing our data business from behind the curtains to the forefront of the innovation agenda.
With more interactions and more data points, we are uniquely positioned to become the go-to source for information, insights, and data-powered solutions. Across our data assets, we have organized around three main areas of focus: create insights, build next-generation products, and combat fraud and other security risks. We will soon launch the Fiserv Small Business Index, a real-time assessment of consumer spending at SMBs, enabling new, valuable insights for financial institutions, policymakers, investors, and businesses of all sizes. This is a powerful example of how Fiserv is bringing data together from merchant sales, core, and digital banking, as well as other money movements. Hope you can see the size of the opportunity here, and now with recent advancements in artificial intelligence, we will surely create even more value. Fiserv has been on the AI journey for many years now.
We started with process reengineering and automation to drive operational excellence, using bots to reduce manual efforts and automate repetitive workflows, like in disputes management or Clover installations. With machine learning, we elevated our business yet again. One example is our AI virtual agent for Clover. Another is enabling our contact centers to automatically handle over 98% of call volumes for federal government stimulus programs. Could not have done it without it. Today, we find ourselves at yet another junction. Generative AI is providing numerous new opportunities. We are poised to use this technology to drive growth and efficiency, as well as serving clients with excellence. We are increasing our use of AI across a number of areas within the company. I mentioned earlier about how AI is benefiting software development.
You heard from Andrew how we're reducing fraud, Advanced Defense, but let me show you another example of how we're leveraging this technology to serve our clients even better. So whether we're talking about artificial intelligence, developer experiences, or technology transformation, at the heart of everything we do is serving clients. It's why we built Client360, and it's why we built our Client Commitment Tracker, an industry-first platform where we enable increased transparency, accountability, and collaboration. As clients use more Fiserv solutions than ever, we continue to elevate how we apply technology and data to better serve our customers. Look, I could spend all day talking about technology, innovation, and excellence, but let me take this final minute to summarize what I hope you take away from this presentation.
Over the last three years, we have deployed nearly $4 billion in capital to create business operating systems and open, scalable platforms. That's nearly 80 million engineering hours, the equivalent of 13,000 software developers annually, dedicated to innovating for our clients. We remain committed to these investment levels and are confident that the productivity improvements we've delivered will continue to create even greater operating leverage for our company. I'll say it again. At Fiserv, we invest strategically and with discipline. We have the experience and scale to support existing clients, and we also have the speed and innovation to win new clients. This is how our 40-year advantage gives us the edge. We are modernizing and transforming our core platforms and core systems. We are creating the next generation of digital solutions, and we are collaborating and co-innovating with our partners and clients.
The network effect of all that we do is truly unmatched. We have accomplished a lot in the first few years as a new company, and we have no doubt that we will continue to extend the lead in the years to come. Thank you for your time and attention, and I'd like to ask Julie to come back to the stage.
Yes, so we have about a few minutes here with Guy, for any questions. I'm sure there's lots of pent-up demand, to ask about some technology questions and all the innovation underway here at Fiserv. So let's just get settled, and we'll get started. Thank you. All right. Tien-tsin, go ahead.
Hey, Guy, I know you've done a ton of replatforming and consolidation and whatnot, so just tell us where Fiserv is in this journey. You've talked about moving to the cloud, appifying, I think consolidating some of the legacy platforms, as we've heard about from Fiserv, as well as First Data. Is there a way to put a timetable on where we are with that journey on modernizing?
You know, it's hard to talk about it in a single instance, because we have a number of different businesses, and they're all on different paths. I think the first thing I would say is, I want you to feel the difference in the message, around openness. So open is key. And I'd say on that journey, we are, you know, we're moving pretty steadily along the line. You heard how we're taking our products, opening them up so that clients can have, best of breed opportunities, but we're also going to compete pretty vigorously in every one of these, you know, particular areas. So I think one is on the journey of being open, focused, disciplined, you know, probably in the first third, first half of the journey and not going to stop going forward.
You know, cloud, an API or a means to an end, it's not the destination. It's just a way to meet clients. So as far as we have a private cloud opportunity, public cloud opportunity, and hybrid, we've offered them to all of our clients, and for the go-forward products that we're building today, they all start in the cloud, whether they're digital, new cores or whatever, that's the momentum on that front. And then data is a key theme here. I mean, we have an unrivaled information base that nobody else can replicate because of our number one position, the breadth of products and the clients that we have.
We take that responsibility in a very significant way to protect that data and use it in the right ways, but you can't build an Advanced Defense product that gets 25% improvement in authorization rates and 45%, you know, reduction in fraud, and so on and so on, unless you really have the data that you can assimilate in real time to provide those decisions. You can always reduce fraud, authorize less. So doing it in the ways that were those three areas, I think are key elements. We're well along our way in the mission, and I'm really excited about it.
Okay. Other questions? Yes, right here in the front.
Hey, Will Nance, Goldman Sachs. Can you maybe talk about in the FI channel, like, how would you kind of gauge the rate of adoption of private cloud solutions and kind of migrations from legacy, like, legacy and licensed customers? And based on all of the investments that you've made in the technology that you've talked about, have you seen any kind of acceleration in the rate of adoption from FIs?
Yeah, we definitely see the rate of adoption increasing, but we see the rate of interest increasing even more. There's clearly fears from financial institutions about their data in the cloud. In our cyber program and the things that we do, we've taken on an extra burden by doing field-level data encryption, which gives them a much more comfortable feeling that PII information in the cloud is safer. The second thing we do is we bring them along on a roadmap. Finxact is a great opportunity to bolt alongside of our core solutions to allow them to get experience, especially if they want to do digital-only solutions.
And as I mentioned, you know, our new version of our digital and our mobile and online solutions that John talked about, XD, fully based in the cloud, and I think they're going to adopt that in a very aggressive and assertive way. So I'd say generally caution, especially with regulatory environments, the way they are, but as we show them, you'll see some of these out here in the showcase. You'll see a lot of these products, but you'll see our Data Cloud product, which we've been giving to banks, where we set up, in this particular case, a Snowflake instance in the cloud. They get a chance to use that as much as they want. They can see in real time, inflows, outflows of funds.
They can see a whole series of things about their business and their clients on a real-time basis. And as you give people that experience, both the confidence and the comfort comes with it, and that begins to extend across the financial institution products.
Ashwin.
Guy, thanks for doing this. Ashwin Shirvaikar from Moody's. I'm not sure I caught the size of the overall tech spend, so if you could kind of comment on that. But one of the things that Fiserv has done exceedingly well, at least I think so, is integrating acquisitions. So if you could talk about how that works, how Fiserv has changed that process from a technology absorption standpoint, and as you sort of think of the next two, three years of initiatives, maybe broadly classify what's organic versus inorganic?
Yeah. Let me try it this way. So from first to last, I would say, our tech budget is, you know, generally in the $3.5 billion range ±. We have the capacity to invest as much as we want, as you heard Frank say, and Bob will say the same. We continue, through those investments, to get greater and greater leverage because of the efficiency we're building into the system, the reduction of the legacy technology, the simplification, that we're injecting into it. And we're also very smart about even the cloud. You know, if you- we have to make decisions on that. If, if we don't charge by transaction and you put those platforms in the cloud, you will lose leverage instead of gain leverage.
So we have been very diligent about how to invest, but I'd say $3.5 billion, 16,000-plus engineers, leveraged across, everywhere in the world, from India to the U.S. to the international regions. You know, I think after that, on the acquisition question, I might go to the barbell. I'd take Clover and Finxact. And, and I think I could say everything in between falls into the same category. When we brought them in, Frank will boast all the time, we kept the founders of Clover here for many, many, many years. And my hope is that we will keep the founders of Finxact here for many, many years. We bring them into the company. We allow them to continue to incubate. We put them into a program. We make sure they're safe, secure, and trusted.
We put them into a program that integrates with management, and we focus intensely on how to connect and integrate them to our existing products at speed. You heard Suzan talk about all the things she'd like to do vertically and horizontally. Number one job is make sure when we get them, they can be integrated quickly, they can become accretive as fast as possible, and we have the extensibility of the platform. So a lot of our focus Finxact is unbelievably open, brand-new, operating languages and environment. In fact, our SLAs are more based on API availability than anything else, which means always on, open access, and that is, you know, that, that thinking, that energy in the company is really translated... The reason I picked that, it translates to everything in between. It's forcing our products to be much more open, yet integrated.
We'll let somebody do a best-of-breed solution. We'll keep it open, but we're going to be really good at integrating our solutions better than anybody else in the industry. Hopefully, that helps. Thank you.
One more back there, Brian. I'm sorry, David. Sorry.
Yeah, no, thank you. You know, if we look back a few years ago, there was this fear that you were going to lose market share. There were all these new little fintechs, et cetera. And as we stand here today, you're going about as fast as you have in probably two decades. You're taking share across the board. Y- what maybe are the two or three things that the investment community kind of got wrong a couple years ago? You know, why, why is it that you're actually taking share today and growing so fast?
Look, you know, it's a—imagine if you're me during that interval. You're sitting there like you want to hit the wall a few times a day because you say these companies who have monoline solutions and are, you know, being rewarded multiples that, you know, a company with $15 billion-$18 billion of revenue, with a client base that we talked about, is extraordinary. And I think the only thing that the investment community may have gotten wrong, and you know better what you got right and wrong, is that this is a complicated business. You can't just... You know, Adyen is a great company, and they could build a product, and so can others, you know, in the different sectors.
But to build the breadth and the depth of what we have and then build it at scale and then, you know, maintain it over time with healthy investment on an ongoing basis, it's hard to do. It is hard to do. And that doesn't mean that large companies are the best companies, but companies like ours, who have experience and know-how, who can accelerate through this, can figure out how to deliver high quality, and client success at the end of the day, and then be able to think out of the box, nurture their acquisitions, and, you know, put some acceleration behind them. I mean, that's those are the teams I bet on, right? I do visit a lot of companies. Those are the companies I bet on.
Those are the companies I want you to bet on, and I want us to be one of them. And, you know, the goal is to just keep proving to you that we're executing every single day, and we work for a guy who thinks about execution 24 hours a day, seven days a week, and that's how the company works. Thanks for the question.
I don't think we could end on a better note than that. Thank you, Guy.
Thank you.
All right. It is time for us to head down to lunch. Hopefully, you've all had a chance to experience the innovation in restaurant technology when you ordered your lunch through our Mercado Experience website. Now, when you go down to your seats, to order your drinks, you can tap your phone on the place card at your seat to communicate directly with our kitchen and order your beverage. In the next few minutes, also, you are going to receive a text message. This text message will have a gift code. The gift code is good for purchase of a new cookbook from world-renowned Chef Andrés, who has inspired our menu today. His staff is preparing our meals this afternoon.
As you're departing lunch, at the end, you can present the code to any of our staff who will be standing there with Clover devices, to process the transaction and give you your signed cookbook. If you don't cook, you know, the holidays are here, you can give it as a nice gift. This is really part of our Fiserv Gives Back program. We're really proud of it, and all the proceeds from the cookbook sales, through Fiserv and through your use of the gift card to donate, will go to World Central Kitchen, which is a fantastic organization you're going to hear a little more about if you don't know it. So that's about it. You can turn around.
Out the door here and to your right are the stairs down to the boardroom for lunch, and we'll see you there. Thanks.
Please welcome Chief Financial Officer, Bob Hau.
Good afternoon, everybody. Hope you had a great meal. We'll try to keep your energy up after having that great food in your stomach. As you heard from Frank in his opening comments, our business has several key compelling characteristics that have enabled us to deliver time and again through difficult macro environments as well as good markets. Now, you don't deliver 38 years of double-digit adjusted earnings per share growth without a great business model and assets that are fundamentally strong. So for the next few minutes, I'm gonna delve into several of these key attributes and provide some details on our outlook for the next three years. But first, let's recap what we've done since we last had a full investor conference. As you know, just as important as consistency of results is reliability of results.
We committed to a set of performance parameters three years ago, and we delivered. Our last Investor Day was December 8, 2020, and at that time, the conventional wisdom was that we'd be coming out of the global pandemic in the first half of 2021. It actually stretched well beyond into late 2022, leading to a more difficult macro environment, and we still outperformed our outlook. During that Investor Day, we laid out an outlook for 2021 and for the medium term, 2022 and 2023. This page is pulled directly from that presentation, which outlined our four key financial metrics, and we showed where we expected to end 36 months later, now at the end of 2023.
As you can see from this page, we anticipated we would add about $4 billion of incremental revenue, deliver $7.40 of adjusted earnings per share, and increase our adjusted operating margin by more than 500 basis points from the 2020 levels, and finally, to generate $13 billion of free cash flow. Now, I'm happy to share that we expect to close out 2023 with $5.1 billion of incremental, which is an average organic growth rate of 11%. At the midpoint of our current guidance, we expect to achieve $7.50 of adjusted earnings per share, $0.10 better than we guided to three years ago. We expect to expand operating margins more than 540 basis points, 40 basis points better than we had guided.
Of course, also to deliver $11 billion of free cash flow. Obviously, lighter than we had forecasted, but as we've been discussing, we used more cash for incremental CapEx and higher working capital as we invested to drive higher growth, which we delivered with the 11% organic growth each year since that Investor Day, well ahead of the medium-term guidance we had given of 7%-9%. Let's move to the more detailed results by year. As you can see, our consistent delivery against our commitments. Our adjusted revenue has moved from $13.9 billion in 2020 to an expected $18 billion in 2023. Operating margin has marched up nicely each year, adding more than 540 basis points since 2020 to roughly 37% this year.
Our adjusted EPS has a CAGR of 19%, including 16% this year, at the midpoint of our current guidance. And all three of our businesses are delivering. Our strongest, growing, and largest business, merchant acceptance, is expected to deliver an average of 18% organic growth rate over the last three years. On the strength of our two operating systems, Clover for small business and Carat for large enterprises, as well as our broad geographic position and breadth of our client base. Our payments business is expected to close out the year with a strong organic revenue growth, once again-... leading to 8% average growth rate at the very top end of our medium-term guidance from our last investor day, which was 5%-8%.
And lastly, fintech is expected to close out at $3.2 billion in adjusted revenue for a 4% organic revenue growth rate in line with our 2020 outlook. Now, our free cash flow is expected to come in at approximately $4 billion this year, up nicely from the $3.5 billion we did last year. And our cash flow over the last three years was certainly impacted by that increased capital spending you see here in the bars, which, of course, helped deliver the accelerated revenue growth. That accelerated revenue growth drove working capital higher. More revenue means more accounts receivable and more inventory.
You can see this relationship of growth and working capital clearly by looking at 2020, where we had no growth, but a 121% conversion rate, and then we averaged 88% conversion from 2021 to 2023 with that 11% organic growth. In addition to our strong earnings and cash flow performance, we are, as always, focused on capital allocation. We have a strong track record of very disciplined and consistent capital allocation. In 2021, you saw us step up our capital expenditures from $900 million in 2020 to $1.2 billion in 2021, and then again in 2022 to $1.5 billion, which we also anticipate in 2023. A big part of this CapEx increase is increased spending on innovation and product development, intentional investment to accelerate that organic growth.
We expect $1.5 billion of CapEx spending is about the right level of spending for the next couple of years, which means CapEx spending will decline from its peak last year of almost 9% of revenue to less than 7% of revenue by 2026, while holding it at $1.5 billion. As you recall, we increased our leverage as part of our July 2019 merger, and at the time, we committed to return to our historic leverage of less than 3x debt to adjusted EBITDA. We delivered on that commitment in 2022 and expect to remain there in 2023 and beyond. The strong cash flow and disciplined capital allocation leads to a meaningful and regular return of capital to shareholders.
This year, we expect to return $4.5 billion of cash to shareholders through share repurchase, with more than $11 billion returned since 2020. With leverage now at our historic norm, we anticipate continued strong repurchase, balanced with disciplined M&A investment. Since we announced our merger between Fiserv and First Data, we've deployed about $2 billion through acquisitions, adding 18 businesses to the company. Our focus has been and will continue to be building out our digital solutions and adding services for our clients. As you can see in this timeline, our M&A investments have spanned solutions for both our merchant clients, like Merchant One, BentoBox, and NextTable, and for our financial institution clients, like Ondot, SpendLabs, and Finxact. We completed international acquisitions, globally acquiring Software Express, EMS, and Yacaré.
I expect to continue to deploy capital for inorganic growth, but as you've heard me say, we have a terrific portfolio, and we remain a very disciplined buyer, focused on acquisitions that add value for our clients and our shareholders. Additionally, we add capability to our company through partnerships. Our recent example is Melio, where we are developing accounts payable and receivable solution for small businesses. As you heard from Suzan and John earlier today, we'll distribute that solution to our financial institution clients for their small businesses and directly to small businesses on Clover. Finally, we have a venture fund that invests in early-stage innovators, and frequently, this becomes a source of acquisitions, as we saw with Ondot, Finxact, and BentoBox. Since January of 2020, six months after we merged, we've been organized around three businesses: Merchant Acceptance, Payments and Network, and Financial Technology.
Over the last three-plus years, we've seen the company evolve, continuing to evolve. Fiserv has moved to a value-added software and services-led model, supported by operating systems as key enablers. As we enter this new era, we are realigning our businesses to reflect our clients, Merchant Solutions and Financial Solutions, which each represent about half of the total business. So beginning in Q1 of next year, we'll be organized into two businesses. Our Merchant Solutions business will be largely what we've been reporting, with the addition of our biller, stored value, and pay-by-bank businesses that had been included in our Payments and Network business. Our Financial Solutions will contain the businesses that provide solutions for our financial institution clients. As you heard from John, our solutions for banks and credit unions have evolved over the years.
Years ago, our client relationships started with selling a core account processing solution and then growing that relationship by cross-selling additional products. Today, we start with a variety of solutions, debit processing, credit card processing, digital banking, digital payments, and then we sell additional services. Many of our existing contracts contain a wide variety of solutions from both our current fintech and Payments and Network businesses, and our clients don't look at these as separate activities. It makes sense for us to reorganize into a single unit serving these clients. I'd like to spend some time digging into our business model. You saw this chart from Frank, but it's why we've been able to accelerate our revenue growth and continuously expand our operating margin, and how this ultimately led to our soon-to-be thirty-eighth consecutive year of double-digit adjusted earnings growth.
It starts with an unparalleled set of assets and is combined with one of the broadest portfolios of solutions that are critical to our clients' operating performance. Our global reach, broad distribution, and strong client relationships, combined with solutions that are designed to enable our clients to grow their business, including essential operating systems for both our merchant and financial institution clients, from Clover to Carat to DNA to Optis, just to name a small fraction. These solutions deliver critical capability to our clients under typically long-term, highly recurring revenue contracts. Now, we add to that a scale unmatched in our industry that gives us operating leverage to deliver margin expansion and stream strong free cash flow. This strong free cash flow and operating margin expansion enables us to reinvest back into the company for next-generation solutions, completing the value-accretive capability.
We add to that value-accretive targeted M&A and return cash to shareholders through share repurchase. All of this is based upon a management discipline that focuses on delivering value for our clients, our associates, and our shareholders. So what you've heard today was designed to help you better understand what's behind our outlook for the next three years. We expect to continue to generate strong organic revenue growth. Our preliminary outlook for 2024 calls for 11%-13% organic growth for the company, led by our Merchant Acceptance, excuse me, our Merchant Solutions business at 18%-20% and our Financial Solutions business at 5%-7%. Now, as we've seen in 2023, higher inflation in LatAm, combined with higher interest rates, leads to organic growth to be a bit higher than we would otherwise see.
We anticipate this to continue into 2024, with an estimated 6 points of organic growth benefit from this transitory tailwind. 2024 is currently projected to have a significant FX headwind that will impact our adjusted revenue growth by about 5% for the company, and nearly all of that is expected to be within our Merchant Solutions business. As we see inflation and interest ease in the out years, we expect to see a reduced organic growth because of that transitory tailwind, but also reduced currency headwind. For our medium term, we expect total company organic growth of 9%-12% for the Merchant Solutions business, leading to 12-15 for Merchant Solutions and Financial Solutions at 6%-8%. We anticipate a meaningfully lower FX headwind in 2025 and beyond.
Now, each of our business leaders walked you through the growth strategies over the last few hours. I've summarized those strategies here. Merchant Solutions continues to be focused on growth through our operating systems, delivering on more value-added solutions, and expanding globally. For Financial Solutions, you also heard us talk about value-added solutions and our best-of-breed open capabilities. Ultimately, the formula is relatively straightforward: Add more clients, grow with them, and develop new and innovative solutions. That strong organic growth, shown at the top of this page, across the Fiserv business model, is expected to lead to 13%-17% adjusted EPS growth in 2024 and 14%-18% growth in the medium term.
We anticipate expanding adjusted operating margin by more than 100 basis points each of the next three years, and we also expect continued strong free cash flow, generating $4.5 billion next year and $5 billion-$5.5 billion in the medium term. That performance leads to $23 billion in adjusted revenue in 2026, with an adjusted EPS of approximately $11.60, a compound annual growth rate of 16% from 2023 to 2026, and operating margins to expand more than 300 basis points from our 2023 outlook. And as you saw from Frank's opening remarks, bringing us to a 40% operating margin in 2026.
We expect to generate approximately $15 billion in free cash flow. That $15 billion, combined with the debt capacity as EBITDA grows, gives us meaningful flexibility to acquire additional capability and return cash to shareholders through share repurchase. As you can see, we expect to sustain strong growth that we delivered over the last several years and continue to expand margins and generate significant free cash flow. We expect this will extend the value of Fiserv for many years to come. And with that, I invite Frank back on stage to wrap us up.
Thanks, Bob. So as we close out our session today, I'd like to share some conclusions that I hope you will take away. It mostly comes down to the playbook you see up here. We have a tremendous set of assets and a leading portfolio of products and a world-class management team. We magnify these assets with a VaaS distribution network that includes leading banks around the world. It allows us to bring great new products to market and then leverage them across thousands of partners for rapid results. We have a highly resilient business with 85% recurring revenue, a diverse client base, and global scale. We have the financial flexibility to invest for growth and adapt to conditions at hand. Our capital allocation strategy is balanced, with strong free cash flow that supports investment in technology, share repurchases, and value accretive mergers and acquisitions.
We have Clover, where initial success is only leading to more success across more partners, more verticals, and more geographies. We have Carat, which is bringing the successful Clover model to enterprises with a distinct value proposition for omni-commerce, which we believe is where all merchants are heading. We have great operating systems across our financial portfolio. They are market-leading and robust, bringing long-term relationships, recurring revenue, and scale efficiencies. Our operating systems integrate well with our value-added solutions, making it easier to layer in high-margin revenue. And as VAS now stands on its own as well, helping us to expand our addressable market. We're extending this value proposition by moving onto open architectures, so our products interoperate with other providers. An important output of our operating systems is data.
We generate a lot of it, and with it, and the help of AI, we're using it to bring intelligence to our operations and our clients. All of this demonstrates clear leadership of Fiserv and many ways for us to extend our lead. Our outlook for the next three years is as robust as the last three, and whether it's revenue growth, profitability, or cash flow, we intend to continue to outperform. With that, I'd like to invite my partner, Bob, up on stage with me, and we'll take your questions. Thank you.
Which one you want?
You got that one. You can get out the door first.
Thank you, I'm David Togut. Thank you, David Togut with Evercore ISI. One of the big themes has really been the blurring of lines and payments, you know, clearly by combining two business segments into Financial Solutions. We also see that theme in the industry with Visa buying Pismo in Brazil, getting into card issuer processing and core processing. So two questions are: clearly, you've outlined a lot of organic investment and growth initiatives here, but there are any pieces of the puzzle that you think you need to add as the competitive environment is clearly shifting? And then, number two, how does that affect thoughts on buyback long term? I mean, you're using 111% of free cash flow this year on buyback. I mean, how do you see that capital deployment model changing through the three-year guide?
Yeah. One I saw in the beginning, and we can talk through it. First, I think we have the greatest set of rails in the industry. We can support any financial institution in any manner they wanna move money, and we can support all their consumers, and we can integrate them with all the businesses we run. And then I think our geographic diversity is a strategic advantage.... I think you've seen our growth rates outside the US, extraordinary things, which I know we all can point to Argentina, but take that out and look at what's occurred there on a normalized basis. So I kind of feel our hand feels very, very good. I would like you to reflect on what we did with something like Ondot and bringing it through to a place Ondot never believed it could be.
Ultimately, integrated into a mobile banking platform to give a best-in-class experience, while meanwhile, in the issuing business, for every one of our cards, we took cardholder experiences to another level. So anytime we could do things like that, which we can put into our distribution system and put it beyond what the expectation is. If you went to the original Clover business case, it wouldn't be what it is today, by any means, by any stretch. So I think, you know, we will invest organically and inorganically. I think, you know, we have a company that's always had a balanced approach to it. I think we've been balanced, bolting on a set of things we did that I hope you appreciate cumulatively, because individually, it may not have felt like that.
I think if you look at what Gustavo did with Software Express and in Latin America, it's actually unparalleled in what return we've gotten from that. We'll be prudent, but we will do things that help our business grow. Maybe Bob and anyone-
The only thing I'd add is, you know, given the strength of the balance sheet and the cash flow generation, there's lots of capacity to do both share repurchase and M&A, and we have a long track record of returning cash to shareholders, and it's exactly how we think about it. It's returning cash to the shareholders. We've taken, I think, a total of one quarter off in the last at least eight years, and that one quarter was the second quarter of 2019 as we were closing the merger, but we went right back into it in the third quarter.
Thank you.
Hey.
Hey, Dan.
Hey, Frank. Dan Dolev at, Mizuho. Great stuff today. Those targets are really impressive. I wanted to ask you, in terms of the conservatism, potentially, that you put into those targets and how much conviction you have in them, and also, what could be some execution, you know, bumps along the way down the road, if any? Thank you.
Well, why don't I start with conviction? 100, and whatever number is the biggest possible number you can think about, Dan, that's my level of conviction.
Hundred's enough.
That's my level of conviction, right? So start there. Our clarity is deep, right? There's nothing that needs to be added to get there at all. And so, you know, I think we're good executors. I think we have the best portfolio in the industry. I think we actually, and Bob can talk about this a little more, are not trying to do anything other than that guide and see what's blatantly obvious to us, and anything short of that wouldn't have been responsible in my mind. I'm sure somebody could be in a different place on it.
Actually, I'll add, you used a term that I don't allow to be used. It's not a target, it's our plan. And we don't set out big targets, we don't set out big, hairy, audacious goals externally. That is the plan we anticipate delivering, and given the breadth of the company, if there's an individual hiccup, it's a hiccup because there are other businesses, other activities that can counterbalance that, and that's how we lay that plan out. Knowing that we're not gonna execute 100%, something will go bump in the night, and other pieces of the company will pick it up.
Hi, thanks. Bryan Bergin, TD Cowen. I've got two for you, one on go-to-market first. Can you just talk about what may have changed on the ground for you internally as you've moved to this new reporting structure, particularly within financial solutions? Just anything as you've gone to this best-of-breed strategy, or is it more so a formality there? And then, is there a LatAm inflation and interest component in that 2025 and 2026 growth assumption in merchant?
So let me add... I'll answer the second part first. Much, much more, quote, "normal." So the, the 6% that I showed for 2024 is the element that we feel we're, quote, "benefiting." It, it's the transitory piece. We anticipate 2024 beginning to improve as we exit the year, and 25 and 26 are, quote, "more normal." And that's more of an impact for organic growth than it is adjusted growth, particularly in Argentina, although this is true generally. We are seeing higher inflation and higher interest rate. Full stop. We're getting a benefit on the organic side, but we're also taking an FX hit, a meaningful headwind, and those two trade in tandem.
So as interest rates and inflation ease, that's gonna lower the organic, but I would also anticipate the FX headwind to ease such that we're comfortable with the overall $23 billion in 2026.
And maybe come back to on the ground, right? If you go back to the comments, we talked about, you know, this has been gradually in the making for four years. You know, we did a merger. I think it was a great merger. Hopefully, you all feel the same. I think it was with thought and two companies that were very synergistic. And I did say that the synergies were great, and when I said that, I wasn't really talking about raising the economic numbers on the synergies, which it did. I was talking about the times we would show up in a client's office and be one Fiserv in so many different ways.
And so probably in 2021 or so, we created a function called relationship management because we believed deeply in that there was so much wallet opportunity in both merchants and in banks, financial institutions, that having a person represent that client into our company and us represented by that person into the company. And I frequently said, in my long life in banks, relationship management is what banks understand. So we need to face off to them, not in a fashion of products. As the journey began, and we were innovating and creating, it became very, very clear that maybe the lines were getting blurred, and we no longer were selling card services and no longer selling core, but we're able to do it from every side.
And then we signed up hundreds and hundreds of banks on merchant acquiring, and all of a sudden, you know, it became very clear we had two sets of clients, our businesses came together. And so I think what changed on the field, one of the key elements of the change was our approach to facing off to the client, our approach to how we wanted to deliver integrated bundles, and our approach that any product could lead. I think that's a major change. Any product could lead. Now, we kind of forecasted that back in July of 2019, or when we showed up in December of 2020. We understood the strength of the individual businesses. We understood the cross-sell. We built a lot of integrated product, and we've changed the company we are. And so today, those are the elements that got to that change.
It's not one beat on the street, it's a series of actions, and then we watched them and talked about it. We got to this conclusion, if that makes sense to you.
Yeah. Hi, it's Bryan Keane, Deutsche Bank.
Hey, Brian.
Hey, how you doing? I think we talked during the break, Frank, this,
Hey, why are you telling secrets? I thought that was a secret.
This isn't the old Fiserv, you know? This is a new Fiserv with higher growth rates in particular than we're used to and people are accustomed to. Can you talk a little bit about the change in VAS in particular, that's carrying the growth rates maybe a little bit faster? Why wasn't VAS a bigger component of the growth rate, you know, before you got here, Frank, and why is it carrying the growth rate to levels that we haven't seen before in the past?
Yeah, well, we can't forget the data and where it was and how we got to the merger in a different spot than we started. And that was the build-out of Clover, right? And, you know, I like to talk about it's 10 years old, but in technology life, that's actually very young, and we haven't hit full throttle on that VAS. But you've seen what our penetration rates have done since we started reporting them. Remember, our penetration rate was zero when we started, so that's a pretty big element. But the learnings from that, then we looked across the enterprise, and I think, you know, whether it's bringing in loyalty, defense, fraud, these are all value-added services that we figured out we could do across every business we have.
And so I think, you know, it's a mindset. By the way, you can't do that without 12,000 software engineers. Like, you can't just want VAS, you know, you have to build it, you have to integrate it, you have to make it a great experience for our clients' clients, along for our clients themselves. So I think, you know, that's been the journey. The consumption is large, though, meaning our clients want them and need them, and our job is to create best-in-class solutions that integrate well. And I think, you know, like I said, if we were sitting here do it... Talking about the merger back in the day when Bob and I met each other, this wasn't part of the equation. It wasn't part of the equation, but I think it's clearly built into the growth rate.
I think it's built into a higher level of client satisfaction rate also. Just, just that's all integrated, and that gives us a strategic advantage.
Hey, guys, it's Darrin Peller from Wolfe Research. Look, just following on to that, to a degree, when we think about the growth rate acceleration in both segments, VAS is a big part of it. There are other drivers I'd love to hear from you guys. List off, perhaps per segment, what are the driving forces for the acceleration on a segment basis? And maybe just add on to it international. It's a much bigger piece of your business now on a percentage basis than it was three, four years ago, and it does seem like your distribution is a differentiator for international. So maybe add on to it what you can really do there. Thanks, Scott.
Yeah. So a couple of things. One, we could pull the slides back up and flip through them, 'cause there were a number of real examples. These are not ideas that we have. These are activities that are currently underway, and it starts with that increased CapEx, and it's one that I, to be honest, I think was just not well understood. We went from $900 million in 2020. We added again in 2021, added again in 2022 and 2023. So in the last three years, we've spent over $1 billion more in CapEx than we would have had we stayed at that $900 million. And that gives you things like XD in our digital banking business, things like the effort we have underway to refresh and renew and cloud-native develop the FirstVision solution.
It's building out numerous value-added services in Clover. It's developing Carat from the start and now continuing to add on to that. It's the solutions you're gonna see in the showcase this afternoon. There's a long fintech development CardHub, and on and on. All of these slowly but surely add to that growth rate. We don't have the $3 billion idea. That's one of the beauties of the company, because we can make investments around those platforms, create the value-added service, and as I was saying at the lunch table today, it's straightforward. Sign up more clients, grow with those clients. As those clients grow, we grow, and then develop new capabilities, so we sell more to those same clients. And it's a simple recipe, and it's what's working. It's part of the value-added service concept.
And it's the multiple opportunities across every single one of our businesses. As you, as you've seen in the last couple of years, and you will see going forward, they will grow at different rates. Not every one of our businesses is gonna grow at that, you know, 9%-12%, but ultimately, some are growing infinitely faster. Our global reach, you use the term international. It's actually not a term I use. We don't have an international business. We have an EMEA business, we have a LatAm business, and we're an Asia Pac different business. And that's meaningfully different because we have people like Gustavo and Katia in the back of the room who are in country, in the region, who know that business and are growing that business for us and developing products, along with our global businesses that provide that growth algorithm.
Great. Thank you. Timothy Chiodo at UBS. So we were all very focused on the merchant numbers of 10 and 3.5, 10 and 3.5, and now it's 12 and 4.5. So the first thing is a clarifier, and then the second is a driver. So the $600 million of revenue that was reclassified into merchant, just wanna clarify that 0 of that is in the Clover 4.5. It's all in the rest, meaning the Clover 4.5 is an apples to apples that we've been looking at for Clover the whole time?
Yeah, so two things: Yes, and let me be clear, it might have been more subtle than I thought it was. Our forecast as we laid out our plan for the merchant business is $10 billion for 2025. That's what we laid out in March of 2022. $10 billion total merchant, $3.5 billion+ in Clover and 25%+ for value-added services. When Suzan went through that chart and showed the $12 billion in 2026, she added a plus to the $10 billion. So in addition to adding that $600 million, it doesn't count towards the $10 billion, either externally with all of you or internally with ourselves. We're gonna deliver $10 billion+ in addition to that benefit of that $600 million.
The reason we move that into that business is 'cause we think we can grow it. It is. It actually belongs with our Merchant Solutions businesses, and we think we can grow that.
Perfect. Thank you for that. The other little minor clarifier was just the getting to the 4.5 for Clover alone. The drivers there are the back book conversion. There's regions outside the U.S. There's hardware. There's value-added services. Could you just stack rank those in terms of the drivers that will get to the 4.5?
I'm not sure I wanna rank them in order of either priority or in value creation. We're definitely gonna see the benefit of each one of those. And if you do the simple math on 25% penetration growing to 27%, again, plus for the value-added services, obviously, that's meaningful. International has been a good growth driver. We see some meaningful opportunities. It's a combination of bringing it to more countries. You'll see some new solutions in the back at the solution showcase as we build out new hardware. We see some real opportunities there.
Hi, Ramsey El-Assal from Barclays. Thanks so much for today, a lot of terrific detail. We all really appreciate it. I wanted to ask again about the back book and explore the idea with you that there might be like a time limit on it, in the sense that if you don't go in and convert, does a competitor come in with refreshed technology beforehand? I'm just trying to think the degree to which the back book is sort of more of a lasting asset or opportunity, or whether the market will force your hand in terms of converting sooner rather than later.
Well, Ramsey, thank you very much. I'm trying to figure out the right way to say this.
Julie's very nervous for some reason, all of a sudden.
You know me well enough, Ramsey. Like, we're not waiting for somebody else to show up, because we're gonna lap every capability in the industry, and we have so far. Remember, we were down, desolate, and broke, and homeless, and we had seven engineers and three patents, and somehow we got the largest GPV software platform. But I just want to clear that up before I get to the answer. So, you know, but I'm paranoid. I wanna look around the corner. I think we have a good methodology. I don't think we're waiting too long. And I'm not scared of the boogeyman on this one, but it's in our growth algo, right? It's in our growth algo. The minute that guy shows up, I'm gonna outrun him really bad, okay?
So I don't think. I mean, we've had you saw our back book growth. It's a strong growth, and we will get it, we will get there where clients want to do it. Remember, 10% of that back book has been converting on their own.
Every year.
But, like, who are you thinking about, by the way?
Who am I thinking about?
Yeah.
Uh-oh.
I don't know any of your competitors who offer an SMB merchant solution that maybe has a software component. I mean, without naming names, so I'm thinking-
I'm just trying to... I wanna know, like-
It's okay.
who you really like.
You guys, Frank, of course, it's you guys.
Hey, that's what you say at all investor conferences.
Vasu Govil, KBW. I want to add my thanks for the great presentations today. I guess I wanted you guys to double-click a little bit on the SMB, AR, AP, and the embedded finance opportunities that you highlighted, which are adding, you know, meaningful incremental TAM. How quickly do you think those can start contributing to revenue? And are we baking in a lot from those in the 2026 outlook? And then a quick follow-up, just given the current macro uncertainty, how have you thought about incorporating that into the preliminary 2024 outlook? Thank you.
Yeah, so, I don't know if I'll execute on a perfect double-click for you, but I'm going to do the best job possible. We've come out and said that, AR/AP solution will begin to be distributed into our FI base, in the summer of 2024. So we've been very clear about that. We have expectations against that, not very large expectations, but over the long haul, we see that as being distributed through the whole FI base. Along with that, you, you heard us talk about it will be an offer on Clover, on the dashboard. That will be later in that year, and, I think at the same timeframe, ISV, ISV crowd will, will have access to it.
We love the partnership, you know, and they're all cheering in Tel Aviv right now, having logged in and have been texting me about, you know, how committed they are to beating the date, but I'm gonna stay with the summer. And so that would be really... embedded finance, you know, I talked in the way I usually talk at the lunch table today. I apologize for everybody who was at my lunch table for being me. You know, we've always were an embedded finance shopping capability. It just wasn't embedded finance was a phrase until later on, and I know sometimes when I talk, it's hard to really figure out what I'm saying, so I apologize for that, too.
But remember, you know, this, this company was born in the eighties, and fintech was founded as a phrase in the nineties. You can check me on this, right? They could, they could-
We Googled it.
We've Googled it. It was at a place that I existed, at Citi. So sometimes you have capability, and you're executing before it's branded, right? More times, people are branding things and not delivering them. We happen to be the opposite crowd. So I think you're gonna see embedded finance, you know, we have it going on right now. What the TAM, what it turns into, we don't have something circled, and I'd say, like in, in all honesty, it is not, neither one of these are baked into 2026 in a manner that are needle movers, but we do believe, much like I believed about Clover, it wasn't a needle mover early on, but long term will be a strategic asset. So I'm sorry for my double-click, but hopefully, that's helpful.
Hi, Ivan Feinseth, Tigress Financial Partners. Thank you for the great event and taking my question. What are your views on how eventually electronic currency will become a mainstream part of the payment platform, and how is Fiserv going to position themselves as the solution provider of choice and the platform of choice to enable that process?
Thank you. Thanks for being here. You know, we run on a platform of our own that said, our job is to enable commerce. It doesn't matter what the commerce is, if it's going to be there, we're going to own a set of rails that's going to execute against it. I haven't gotten any of these time frames right yet, right? You know, but, you know, we've always taken the position that we are going to enable every form of commerce, specifically for our businesses, right? We are a large settlement engine for them, and if we don't have every part of it, we're not doing the job.
So I don't, I don't have a crystal ball on time frames, but you should be assured, as you know, what I believe is the best set of rails in the industry, and these won't be those type of rails. Lots of them are virtual today in a different manner, that we would, we would be an industry leader at, and enable it as long as that's what our client base wants. We're a client-centric business.
So with that, we're out of time, and this concludes our formal portion of the business. For those of you that are on the web, thank you for joining us. For those of you here in the room, I encourage you to visit our solution showcase, which is just outside the foyer here. You'll see many of the unique products that we talked about today, and I'll join you out there shortly, along with our business leaders. We're incredibly proud of the innovation, and we hope you'll take some time to see it for yourselves. Thanks for joining us for today, and thanks for your interest in Fiserv. Have a great afternoon.