Welcome to Visa's Conference Call. All participants are in a listen only mode until the question and answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host, Mr.
Mike Miletic, Senior Vice President of Investor Relations. Mr. Miletic, you may now begin.
Thank you, Michelle. Good afternoon, everyone, and welcome to Visa's conference call. Joining us today are Al Kelly, Visa's Chairman and Chief Executive Officer and Vasant Prabhu, Visa's Vice Chairman and Chief Financial Officer. This call is being webcast on the Investor Relations section of our website at www.investor.visa. A replay will be archived on our site for 30 days.
Let me remind you that this presentation includes forward looking statements. These statements are not guarantees of future performance and our actual results could differ materially as a result of many factors. Additional information concerning those factors is available And our most recent reports on Forms 10 ks and 10 Q, which you can find on the SEC's website and the Investor Relations section of our website. And now let me turn the call over to Alf.
Thanks Mike and happy New Year to everybody and good afternoon and thanks for Joining us on relatively short notice, we announced earlier today that Visa and Plaid have mutually terminated our merger agreement and have agreed with the Department of Justice to Missed the litigation related to the proposed transaction, we are confident we would have prevailed in the Litigation as Plaid's capabilities are totally complementary to Visa's not competitive. The combination of Visa and Plaid would have delivered significant benefits greater innovation for developers, financial institutions, and consumers. However, it really became quite clear in recent The Department of Justice is not inclined to work with Visa and Plaid to bring this process to a timely and reasonable conclusion. 1 year has passed since we first announced our intent to acquire Plaid. We have confidently decided that it is in the best interest of all stakeholders for Visa to focus our attention on advancing our broader strategy rather than moving forward with a protracted and complex litigation.
We have 3 growth paths, consumer payments, new flows and value added services, all with tremendous upside. We have much to do and many attractive opportunities. Therefore, we decided not to devote more time to this acquisition. We will continue to partner extensively with a broad range of Fast growing FinTechs to deliver the infrastructure security and innovative services required to power industry leading payments and money movement experiences both On and off Visa's payment network. Over the past year, we have built great momentum in execution of our network and network strategies.
In fiscal year 2020, Visa Direct has grown almost 70% to nearly 3,500,000,000 money movement transactions, utilizing 16 card based networks, 65 domestic ACH networks, 7 RTP schemes and 5 payment gateways. Our value added services revenue has grown in the mid to high teens and we continue to add to our capabilities, including risk, Identity, tokenization and dispute services that can be offered regardless of the payment rail used to deliver the funds. We are also seeing an accelerated shift to digital B2B payments with the rapid growth of virtual cards across several industry verticals. The initial adoption of our B2B Connect solution for cross border payments and the expansion of partnerships to offer innovative solutions For domestic AR and EP. Moving forward, we will still intend to deliver payment initiation and value added services The FinTech developers globally for non card and or RTP payments.
In addition to utilizing our own capabilities And partnering with Plaid, we will also partner with financial data networks all over the world as local providers often have a deep understanding of the market nuances necessary to best serve FinTech developers. We've invested in and already worked with partners in our Europe The combination of our global footprint, our unmatched reliability, our trusted brand, strong Financial institution relationships, our portfolio of value added services, and lastly, the broad array of money movement capabilities available through our network of networks Makes us a very attractive open banking partner around the world. As always, we will continue to keep you updated as we make progress, Realizing the vast opportunities ahead. Before I turn it over to Mike, I'd like to thank Zach Parra and the entire Plaid team. We continue to So impressed with the company they've built in the depths of talent and we look forward to continuing to work together as an investor and a partner to enable more innovation for FinTechs.
With that, let me turn it back over to Mike.
Thanks, Al. Michelle, we're ready to take a few questions.
Thank you, sir. Our first question comes from Sanjay Sakurana, you may go ahead.
Thanks. I guess my question is whether or not you might consider Other acquisitions of open banking players and maybe how significant do you think your strategy to capitalize On the opportunity that you had with Plaid is impaired as a result of this deal not happening? Thanks.
Sanjay, thank you. Look, We obviously really like Plaid. We like the company. We like the people. We like the capabilities.
But we believe that we've got The assets and the capabilities and the experience to move on and approach things in different ways. I certainly am not going to comment on specific acquisitions, but I'd remind you that what our approach is that our first choice is always to do things organically where we can, then Then we look to partner where we can find a good complementary company. Lastly, we look to acquire companies that can bring capabilities to Visa.
Thanks.
Thank you. Our next question comes from Lisa Ellis. You may go ahead.
Terrific. Thanks and thanks for doing this call on short notice. Can you just guess Presumably as this deal has gone away, you've sort of reset your overall FinTech strategy. Could you just kind of quickly re summarize for us how you're thinking about how Visa serves FinTechs more broadly all over the world, especially in light of how much explosive growth we've seen in that space over the last 9 months.
Well, Lisa, FinTechs Have been very important to us for probably the last 3 years and we've been very engaged with them in terms of Working with them in some cases as clients, some cases as partners, we have adapted as we've talked in the past about Our FinTech Fast Track program where we bring FinTechs into the Visa network in much Faster, less bureaucratic ways than we might have done with other players. And so I certainly feel very, very comfortable We've got a good position with FinTechs and a number of good programs in place to make sure that we stay Very, very attractive and competitive in that space. If I come up A level above that, which I think you might have been implying. I think we have a terrific network and network strategies and a great array We've already immersed ourselves in money movement both on and off the Visa network. And I think That takes a number of capabilities that I alluded to in my remarks, infrastructure, security and innovative and high quality services.
And we're going to continue to it's going to be continued to be part of our plan to make sure we deliver payment initiation and value added services to FinTech developers globally For non card and card and RTP payments and money movements. So I believe that we are Well, it was a terrific asset. It would have been nice to have it in our fold. The reality is that we are making a judgment that there is plenty of Opportunity in this very fast moving space and we're just going to move on with life and take advantage of these other opportunities rather than get I'm down in a long drawn out process that's already been long, never mind how much longer it would go.
And our next question comes from Dan Perlin.
Thanks and good evening. Obviously, a disappointing outcome for you guys, but I just had kind of this it's a little bit of a 2 part question. One is, are there opportunities To create maybe a more meaningful commercial agreement with Plaid that could ultimately drive some similar outcomes. And then secondly, The Department of Justice complaint clearly suggests, rightly or wrongly, that there's some possible anti competitive around it. And I'm just wondering how that influences the way you look at opportunities both in the United States and maybe abroad.
Thank you.
Thanks, Dan. A few questions there. So first of all, there's no question that we have many to partner with Plaid because we have complementary capabilities, which was a lot of the basis for this deal in the first place. And we are and we'll be discussing them with them. I think, for example, we'll work with them in thinking about how to approach FinTechs to Have them be involved with both of us, Plaid to distribute or make available Visa value added services for their clients, Visa could offer payment facilitation capabilities to Plaid clients.
So there's a number of things that we have already begun and we'll Continue to be discussing with them. Relative to the DOJ's claims of debit monopolization, We just believe that the lawsuit is wrong on the basis of facts and the basis of law. And the reality is that The debit market is highly competitive and highly complex. Our debit business faces Tense competition from a variety of players, including 10 different debit networks, and we place vigorous competition from other form of payments, including cash, Check and credit. As it relates to other Acquisitions, we believe absolutely we've made 5 acquisitions in the last 18 months.
Everybody's got to bear in mind, this is a single lawsuit from a single regulator about a very specific M and A transaction. So I don't have any worries that We have the ability to do what we need to do, whether organically, in partnership with Plaid or with lots of other players Or by buying things that we have the capability to do what we need to do to continue to grow the business.
Great. Thank you.
Thank Ashwin Sherbaker, you may go ahead, sir.
Thank you for taking the question. I guess, I was Hoping to get maybe an example of what you might not be able to do with FLAD as a partner that you could have done with That is a part of Visa. And then separately, was there any financial cost to It says mutual termination, obviously. So I just wanted to figure out the financial cost of walking away.
Okay. Look, we view Plaid as another network. They happen to be a network where The fuel is data, whereas we move funds. So obviously, by not owning Plaid, we won't have the ability to kind of have that data movement network under our roof as a potential revenue stream. But we're going to be able to work with Plaid and other data extraction players around the world to be able To replicate the capability that will allow us to get in the middle of Other aspects of, for instance, account to account movement, whether that's the actual movement of funds Or selling value added services.
So I think in general, from a capability standpoint, we'll be able to Have alternatives to what Plaid would have been able to offer us. It's just that we won't have it as a specific Business lines. As it relates to your second question about termination, there's No termination fees though to either part by either party to either party. Vasak, can you add anything?
No, there's no payments required by either side. So there's no financial cost to the termination.
Thank you, Paulette.
Michelle, we'll take one more question.
Thank you. Our next question comes from Darrin Peller. You may go ahead.
I'd love to just hear if
you could reiterate your strategy in terms of international versus domestic on open banking given there are some differences on
And if we looked out 2
to 3 years from today, how much of a bank funding model Into wallets and those used at the point of sale, like what kind of part of the ecosystem do you anticipate that being? And then maybe just explain where you are going to be positioned in that Thanks again, guys.
Well, Darren, I think that, first of all, open banking is really very new and it's in Very early stages of creating use cases. The most likely use cases account to account money movement and we feel like we're Quite well positioned in that space. While clearly planned would have diversified our Brings enabling data availability. We can get there. In other ways, as I think I might have said in responding to one of your earlier questions, We can partner with Plaid.
We can work with other data extraction players around the world and we can work directly with FinTechs. And It is our belief that there are a number of very good financial data networks around the world Who have a local nature to what they do and therefore understand the nuances of those particular markets. And we will be engaging With them to see how we might work together with them as the data extraction piece. And then in terms of actually moving and enriching money movement, We're going to continue to pursue our broader strategy of being able to offer core services both On our networks and on RTP systems, and as we said about RTP systems, we're not interested in the core infrastructure. We're focused on And service levels where layers, I should say, where I believe the value lies.
And we have a lot of excellent capabilities To offer there, some supported by our acquisitions, Bell ID's tokenization capabilities will allow us Tokenized bank accounts, Verified will provide dispute capabilities. Our Cardinal Commerce business will provide We also have loyalty security analytics services we can offer. And even the most recent acquisition we made of Yellow Pepper It's going to provide a way for financial institutions to much more easily access our capabilities. So We believe that the only thing that in essence that we wouldn't have in one stop shopping By owning plan is some of the data extraction elements of this, but we could get there in other ways as I described.
Okay. All right. That's helpful guys. Thanks. Thanks, Al.
Thanks. So Again, thank you for everybody for calling in on short notice and we look forward to talking to you in a couple of weeks on our Q1 earnings call. Mike?
Thank you for joining us today. If you have additional questions, please feel free to call or email our Investor Relations team. Thanks again and have a great evening.
And thank you. This concludes today's conference call. You may go ahead and disconnect at this time.