Coronavirus: Top payments execs weigh in on risks, responses

Mastercard spoke up early about what most companies felt, but were afraid to say: Things were OK for now, but if coronavirus becomes a pandemic, all bets are off.

Because a major portion of Mastercard's business in China occurs through e-commerce, and the company is not hurt as much by canceled travel plans, president and CEO Ajay Banga is hoping for the best.

“If it becomes a much bigger crisis, then we’ll take a look at those numbers. Have to take that as it come; it’s the only way to look at this,” Banga said.

Regardless of how far the virus spreads in the coming months, Mastercard intends to stay on course with its plans to continue driving digital payments in and out of China, including working with Alipay and others to establish a market there when trade wars calm and Chinese regulations ease restrictions.

Visa CEO Alfred Kelly also advised caution, acknowledging the uncertainty that surrounds all companies in contemplating how to counter the virus and keep business losses to a minimum.

"When we look at our numbers in China, we see some declines, but the Chinese New Year was a month earlier this year and spending slows around that holiday period," Kelly said.

But things could get worse before they get better, Kelly said.

"There is going to be an impact when planes are being halted in and out of China and you are constantly reading, as we are, that companies are telling employees to stay home," he said. "So even in the e-commerce world, if employees are saying home, who is picking out the goods and shipping them?"
Recent estimates from economic experts have indicated that many companies can expect delays of up to several weeks in products coming out of China.

American Express CEO Steve Squeri recently told analysts that the New York-based company, a leading provider of cards for business travel spending, has seen significant reductions in spending in certain parts of Asia, including Hong Kong, Taiwan and Singapore, which have been harder hit by the coronavirus than many other parts of the world.

Amex derives 8% to 9% of its net revenue from the Asia-Pacific region, which also includes Australia.

Squeri said that Amex is likely to curtail its spending on coverage and promotions in the regions affected by the virus, according to a research report published Friday by Instinet analysts.

To the extent that coronavirus continues to spread in Europe and the Western Hemisphere, it has the potential to be more detrimental to Amex, Squeri said. Still, he remained bullish on the card brand's growth outlook.