FutureBanker: How are you facilitating Visa's corporate strategy?
Eitingon: Each time we have a board meeting, we try to go in and lay out what our basic corporate strategy is and, beyond that, how to drill down (to) how our role is changing and what should it be going into the future. Take (Visa's) brand; brand is often viewed as our major asset. How should we be leveraging that; are there other things that we could be doing beyond what we do that would be good for our membership?
FB: In your global responsibilities-strategy, product and systems development, computer operations, customer service-does change come at a slower pace than when you were First Interstate's technology chief?
Eitingon: Those kinds of decisions that have to be approved by regional boards clearly are slower. But on the ones that don't have to go through that, we're capable of responding at comparable speed.
FB: Of Visa International's six regions, which one offers the greatest opportunity to the association?
Eitingon: It depends how you look at it. The United States is huge; it's half the company's business roughly and we're still growing at a fairly substantial pace. So if you take the growth on a large base, it's still the largest piece of additional business.
If you're looking at pure growth rates, Latin America-Caribbean is probably (one of) our top regions. Then you have individual countries in some of these regions. Take China; while the growth rate is pretty high, you can just imagine what that country is going to be like as it starts to emerge. As these countries start to develop the infrastructure of a modern economy, all of a sudden people have money in their bank accounts and they want to become more of a consumer economy. That means cards are more than likely going to play a major role.
FB: In the U.S. region, where's your greatest product development emphasis at this moment?
Eitingon: In two areas: corporate cards and debit cards. It's no secret that American Express has been the leader in this particular arena. We think we have an opportunity to leapfrog them. There's a tremendous opportunity for growth in that particular business, so we're putting a lot of resources into that.
On the debit side-it's taken off unlike virtually any other product- we're seeing growth rates of 50, 60, 70 percent a year in terms of transactions. Transactions that are not credit card-the 95 percent that are cash and checks-are now getting eaten into by (off-line) debit cards.
FB: Amex has a substantial presence in the corporate card market. How will Visa give chase?
Eitingon: We need to have better features, better reporting, more capabilities and clever innovation. That's what I mean by leapfrogging. Our members do issue quite a few corporate cards, but people don't think of Visa (as much as) American Express in that particular area. So you have a classic problem where (there is) a market leader, but they have a classic problem in that being the market leader, they run the risk of somebody putting (forth) a major initiative and trying to leapfrog them. That's exactly what we're going to do.
FB: What advantages does Visa have over American Express?
Eitingon: We have our membership, which in some companies' views might be seen (as an advantage). But more importantly is if we can bring the right products to bear, the right reporting (features) that will make it easier for corporations to track and control expenses-cards that potentially could have chips on them that restrict what kind of merchants they can be used at and so on. We could issue a card that (could) restrict where it could be used; we could issue a card with a specific dollar limit associated with it. This could be chip-controlled; it could all be handled locally; every card could be different if the company wanted it to be.
Banks generally own the cash management relationship with these businesses; this is viewed as an adjunct to that. The banks can integrate this as part of their overall cash management relationship. A lot of businesses prefer an integrated approach to cash management. If we have a product that's competitive or better than that, it would be an overwhelmingly compelling decision for them to go with their bank as opposed to a separate vendor.