Reduced Rate of Visa and Mastercard Foreign Exchange Decrease
By Daniel Webber
In a recent analysis, there is a growing anticipation that we may see a return to lockdowns during the winter months, as the global fight against the pandemic continues.
However, despite these challenges, the travel sector is showing signs of recovery, particularly in personal travel. Our data indicates that personal travel is projected to be the larger contributor to revenues, with a faster recovery rate compared to business travel.
This revival in personal travel can be attributed to the summer holiday period and the easing of lockdown measures within the EU. EU travel during the quarter saw an increase, providing a much-needed boost to the industry.
Yet, the story is not the same outside the EU. Travel beyond its borders remains weak, reflecting ongoing uncertainties and travel restrictions.
The recovery of cross-border revenue at Mastercard and Visa is being driven by the surge in cross-border commerce and digital payment volumes. However, the full recovery is being hindered by persistent geopolitical uncertainties, travel restrictions, and changes in consumer spending behaviour.
Interestingly, card-not-present transactions continue to perform well, with ecommerce growth remaining strong, over 20% up year on year. This suggests that the shift towards digital payments, accelerated by the pandemic, is here to stay.
As we navigate through these challenging times, it's clear that the travel and payment industries are adapting and finding ways to recover. The focus now lies on overcoming the remaining hurdles and embracing the new normal.
