Visa Inc. (V) Earnings Call Transcript & Summary

Well, good afternoon, everyone, and thank you for joining us for our keynote session at our annual conference. Thank you so much for attending the conference and participating. Very important, given everything going on in the world, changes in the world to really -- to get together and to talk about and try to understand the things happening around us. I'm Dave McKay, President and Chief Executive Officer of RBC. And I'm very, very excited to welcome Al Kelly, Chairman and Chief Executive Officer of Visa to be our key note speaker. I'm very, very excited because there is so much going on not only in the world, but in the world of payments. What's the geopolitical role that payments is playing, how the shifts in society are affecting payments, the role payments is going to pay play in the future of commerce and the future of our economies, how technologies impact payments. Moving money around the world is a core capability of Visa and I couldn't think of anybody better than Al to lead us through that discussion of change. As many of you know, Al, again, is Chairman and Chief Executive Officer of Visa. He joined Visa, Al in 2016 after a fantastic career, 23 years at American Express, culminating as President of American Express, I think from 2007 to 2010. You took the opportunity to lead a digital media technology company as Chairman and CEO. Obviously, a very different and exciting experience to build a small company and it really helps you understand many of your clients and the changes going on. So I think that was an incredible role. But as so many of you know, Al is a huge giver to communities and participating communities as a trustee of Boston College, as a trustee, obviously, of the Mother Cabrini Health Foundation and Chair of the Health Foundation and a trustee of New York Presbyterian Hospital. Board of Directors of Catalyst organization, which we're also a continuing participant in so we share a common bond there. Al, from a corporate leadership, community leadership, ESG perspective, you're a leader in so many dimensions, and I wanted to welcome you as our keynote speaker in today's conference.

Dave, it's a real pleasure to be with you. It always is. I wish you could be in person. I think we're actually going to see each other in person in a few weeks. It will be great to do that. But I'm very glad to be with you and your audience today and talk about some very interesting things going on.in the world in general and the world of payments, as you said.

Well, I'm really looking forward to our conversation. And why don't we just start right there. There is a lot going in the world, a lot of change, humanitarian crisis, a crisis none of us really thought was going to happen. We're in a bit of shock as a society that this could happen. We're being asked to play in the financial industry and Visa, in particular, a different role. You have operations in Russia you have to deal with. Can you let us know from your seat kind of what you're focused on and how you're managing through this crisis and playing the role you're asked to play?

Well, Dave, I have to say it really has upset the world in a huge way. And I think we're only in the 11th day of this. It has occupied my time pretty much 24/7. We have 155 employees in Ukraine and a couple of hundred, 210 or so in Russia. So in the initial days, our focus was pretty much exclusively on Ukraine and trying to do everything we could to help our employees, all of whom lived and worked in the Kiev area. And we have done some really terrific work with security firms that we have hired, and we've been able to move about 50 of our people out of the country. And they've gone to Moldova, Romania, Hungary and probably the bulk has gone to Poland. We have security in Romania, Poland and Hungary with Sprinter vans loaded with supplies, and we're within a half mile of the border crossing points in those cases to help families once they're extracted. And we're down to, I believe, as of this morning, about 10 employees in the Kiev area with the balance to the west in different places. And we've been sending every day. There's a -- even in war, cottage industries spur up and we have found mercenaries who are willing to take vans of people, and we've been getting to the western edge of Kiev. Unfortunately now, men can't move even. So up until about 48 hours ago, we could help move a man. But about half of our employees are men, half are women, our actually -- our Head of Ukraine as a woman who now is in Budapest. Her husband remains behind. You can't -- a man can't leave the country if they're between 18 and 60. But prior to about 48 hours ago, they could move west, but now there's so many more checkpoints set up even on the edge of Kiev, that if a man is in the van or the Sprinter, bus or whatever it is, there's a risk that the entire group will be turned back or stopped for a long period of time, neither of which is good. As the week -- last week went on, I'd actually say, it's been crazy. I was in a week ago, Sunday, I was actually in church, and I normally don't bring my phone into church, but I did and I got a text message about 10 minutes in that I had to jump out and President Zelinsky was trying to get a hold of me. And that was the initial sign to me about the pressure we would feel relative to them trying to pull every stop they could to put pressure on the Russian government. I would say that it was probably the middle to the back end of last week, where we focused more -- starting to focus on Russia. And we drew 3 conclusions Friday that ended up in our decision on Saturday to suspend our business. One, was that it was getting increasingly difficult to operate in Russia. You and I were talking before we started about the sanctions and some of them just aren't very clear and they're causing changes in operational procedures and technology that just was kind of a pain. Secondly, frankly, we didn't like what we were seeing. This was an unprovoked invasion of a beautiful country with beautiful people and we just couldn't stand by as we were seeing stories. Probably one of the most brutal meetings I've had in my career was talking to our Ukrainian employees last -- a week ago today and they sent -- they put pictures on -- projected pictures on the screen of their homes or former homes or the homes of their parents or loved ones. It was just horrendous. But -- that was the second reason. We were just horrified by what we were seeing. And thirdly, we decided to get out ahead of it. We think this thing is headed for another round of sanctions, and in that case, probably a very disorderly under -- wind out of our business there. And we decided we would be far better off taking a thoughtful wind-down approach to the business. And therefore, today, as we sit here now 3 days after our announcement of suspension, we're working closely with our clients in Russia, settlement is working as it should. It's BAU. The Russian clients are doing the right things. And hopefully, I think they believe we're doing the right things. We now have a new focus, which is on our 200 employees in Russia. 25 of those 200 have in the last 48 hours left Russia for other places, predominantly Dubai at the moment as a kind of a staging place. That's our headquarters for our Middle East and Africa division of Visa. So we're going to continue. We have a couple of times a day, calls. And where our #1 element is -- our focus is the care and safety of our employees, where we're doing things that I never that we'd have to do. We're standing by the life insurance in Ukraine, which is no longer valid because it's a war. We're getting people life insurance and health insurance in the new countries. So I was taking a woman last week who's got a 3-week old baby and left her husband behind and went to Poland, and we wanted to make sure that she was able to get to a pediatrician and facilitate that, and we've dispatched lots of people to the area, at least to the surrounding countries to try to help. So it's been a very difficult and trying situation for all of us. And I've learned more about war than I ever knew before, including the fact that it's been slow to set up these humanitarian corridors that allow things -- people like the press and medics and people who want to seek -- leave the country. And in fact, unfortunately, we've seen in the last 24 hours that when ceasefires are agreed to, the Russians are ignoring them and therefore, people wandering and getting hit by bombs, it just -- it's an awful, awful situation and how long it goes on and where it stops and where it goes is anybody's guess at this point, Dave.

What an amazing, a heartbreaking story to hear about your employees and so many obviously, citizens being separated from their families and their loved ones and the stress and uncertainty and the loss of life and I'm not surprised, having been on the Visa board for, I guess, it was 8 years or 7 years and seeing the culture of Visa, as a director, I'm not surprised with your leadership, the great humanitarian touch that you've applied to all your employees and to make sure that they're safe. And then obviously, the complexity that you mentioned of implementing sanctions in a complex financial world with so many back doors, there's a great emphasis. Our organization is the same way, as we try to implement a range of changing sanctions in the countries that we operate in, very much a strong operational focus to make sure we do everything right and correctly at the right time. So I can appreciate. You have a much bigger global business and even more complexity, but I understand what you're trying to go through. And thank you for sharing that, and I think it's really important to understand the depths with which CEOs and leaders are trying to make a difference in a very, very difficult situation and being put in a difficult place. Maybe I'll pivot a little bit to -- it's hard to pivot from this topic, obviously, it's a really emotional topic, but there's a lot going on. Pre-pandemic in the world of payments, the pandemic accelerated many trends, created some new themes around the future of money. And as you've said many times and I talk about our payments business. We're in the money-moving business. And the money-moving business is changing significantly. So with that open-ended question, I know you've got a lot of ideas around the future of money. Now how do you see the future money? What's been accelerated by the pandemic? And how do you help our audience, CEOs and investors, understand the future of money and the changing payments world?

Well, I think it's probably important to go backward to inform the future a little bit. I've been in and around this business now for over 3 decades. And if I look at the period from, say, 1985 to 2010, that 25-year period, it was basically credit and debit cards, co-brands. You and I both saw the period of, right, huge focus on accounts receivable, where people were doing -- we started with 90 days, it's 0%, and I think it ended up, there were some people doing 24-month 0% balance transfer offers, but this last 12 years, from 2010 or 2011 to 2022 has seen much more change than the 25 years before that facilitated by all kinds of things, starting with governments. Governments have become much more active in payments. Some of it might be deemed more of a hassle in terms of some of the regulatory attention. But frankly, governments have also been a positive catalyst. Modi's decision in November of 2016 to demonetize in India, what caused massive chaos for probably about a month, but it really was a move that catapulted a fairly rapid development of payments in India in that period over the last 6 years. It's an amazing amount of change. And we were the market leader in the market in India before that demonetization, and we remain the market leader, and we've been able -- it's a case of all boats rise. The reality is that certainly, new competitors have come in, because the market have become much more attractive, but it's been very good for our business as well. Plus governments are focused on trying to lead by example, where they're trying to put their subsidy programs, stimulus programs, et cetera, in a more of a digital format. And some of the countries besides the ones you and I live in where there's big gray economies, they're trying to get rid of that gray economy by forcing more digitization and using debit cards and prepaid cards in a much better way. But we've also, in this period of time, see the emergence of fintechs. And I'd like to think that Visa was the first great fintech story coming into the marketplaces as a public company only in 2008. But there's been all kinds of other advances in terms of new ways to pay that have changed the landscape of what we see in the world as well. So I think that it's a really interesting time in payments. Now that said, the pandemic has been a bit of a game changer. It has greatly, probably by years, accelerated cash digitization. Tap to Pay has grown tremendously as people feared touching money. So now 70% of the face-to-face transactions around the world. In a kind of a crazy situation, the market that's been the furthest behind is the United States. But because the United States has also obviously been impacted by the pandemic, it's accelerated. Now U.S. about 20% face-to-face. New York City is -- 45% of face-to-face transactions are Tap to Pay. So it's really accelerating. We saw 7 countries just in the last quarter. increase Tap to Pay penetration on face-to-face transactions by more than 10 points. So it's pretty dramatic to see what's happened. A few other things. before the pandemic, credit volume and debit volume would grow within 100 to 200 basis points of one another. What we've seen during the pandemic is we saw this huge separation. Debit never went negative and credit went big time negative, and we saw in some months and quarters as much as a 40-point differentiation between debit card growth and credit card growth. Similarly, we saw our e-commerce take off. And as a result, card-not-present grew much more and never went negative than card-present volume. So what we're seeing now, starting, I'd say, last June is really a terrific recovery. Card present and credit have come back, but really not harming debit or card-not-present in any pronounced way. We just did an 8-K last Wednesday night, so I could talk about some very current data with you and your audience. So in February, the U.S. total payment volume was 145% of 2019 levels, up 5 points from January. Credit was at 135% of '19, up 7 points in January. But card-not-present was still 154% of 2019. We saw increases in card present and card-not-present Categories that have been stressed during the pandemic fuel, travel, entertainment, were all up over 8 points. If you look at what's been happening in cross border, you saw our markets start to open. The U.K., France, Spain, Portugal, Thailand, Singapore, all examples of markets that in the last 45 days or so have either eased or completely eliminated restrictions. And so that's facilitated cross-border starting to come back. By the way, the recovery did hit this bump in the road from mid-December to mid-January called Omicron. So there was a disruption. We actually saw volumes actually died during that 4- or 5-week period, but they've really started to come back. If you look at February, cross-border volume was 112% of 2019. Card-not-present cross-border, is 169% of '19 and travel hit 81% of '19. So travel is still down. Cross-border travel was the biggest loser in the pandemic. If we go back till April of last year, it was running 40% of 2019. By June, it was 50% of '19, by September, it was 60% of '19, and we actually predicted it would get to about 68% in the quarter ended December 30, but it actually got up into the 70% to 75% level. And then it dipped again during that Omnicom 4- or 5-week bump to below 70%, but it ended up in February, up 81%. And to give you a sense of the momentum, in the U.K., which opened its borders, if you look at the fourth week of February, the last week of the month, volume inbound into the U.K. was 30% higher than all of January. And similarly, in the U.S., if you look at just the last week of February, volume was up 10% on in that week versus the entire month of January. So we're now thinking cross-border is going to get back up as high as 90% of 2019 levels. And I should say, Dave, it's extremely inconsistent in terms of around -- as you look at it around the world, that the corridor that is the biggest winning corridor around the world, and we don't have a major concentration in any one corridor, but the one that's really exploded is U.S. to Mexico. It's been running 160% to 180% of 2019 levels. But if you look at the long haul into Asia from Toronto or from New York or from London to whether it's Beijing or Tokyo, it's running kind of closer to 30% of 2019 levels. So that's kind of -- that's probably the extreme. It's kind of 30% inbound to some of Asia to about as much as 175%, 180% into Mexico. So again, I personally think that despite this war that has taken place, that the recovery is going to continue. I think people are going to continue to want to travel. There's -- just 2 years of being locked up. It's just at least a couple of months or a year or 18 months too long. And I think people want to get out to restaurants, they want to get out to see relatives. They want to go see places. They want to go ski, they want to go to play golf. They want to go to the beach. So where does this take us? Well, one of the big things that's also changed during this time is there's many, many more ways to pay, whether it's wallets, installments, better said is buy now pay later, crypto. And the reality is that for us at Visa, we think this is all good. A lot of people come and talk about it being very disruptive to us. They're really just new ways to pay. And we want to make sure that we're leaning in and taking kind of an agnostic view. I think ultimately, the consumer should decide who wins and loses. I don't think RBC or Visa should be deciding who wins or loses. We should put out options as you often do at RBC, and we try to make sure that we accommodate all of those options. I don't -- I have personal views on buy now pay later, we can talk about it or not talk about it, but we're leaning into it similarly, and we'll come back and talk about crypto, I have views about -- personal views about crypto. But put all those things aside, our job is to lean in and facilitate and ultimately decide what the consumer wants. In short, the future of money is digital, more inclusivity and more diversity, if I was to really summarize where I think the future of money is going and we can dig into any of that you want me to elaborate on.

There's a lot there. And if you're comfortable, I'd love to get your views on buy now pay later because I know I get asked that question by investors all the time and the bank CEOs would love to hear. But I know there's a number of stats that you've tracked from the beginning of the pandemic through and it really gives us a pulse on the change, but also a pulse on the economy. The first stat was the percent of merchants and businesses that had 0 revenue that you tracked from its -- from its trough to where it is today, it would be interesting if you have that handy. And then to your point about reach and expanding the pie and debit and card-not-present and online. I think you have a stat that a number of first-time online e-commerce users is significant, driving that expanded pie. Do you have those kind of stats top of mind? And I know you track them.

I can talk about -- I don't have it exactly, but I can certainly talk about them thematically. So we were very concerned about the impact on small businesses. We've always been big fans of small businesses. And I know you and I have talked about how important they are, not just to business, but they're important to society. Every -- bedroom communities all have main streets, and they don't just want a bank and a gas station on that main street. They want all kinds of other types of stores, often are just local entrepreneurs. And even before the pandemic, these poor businesses were being hit hard by the emergence of Amazon and other big gorillas. And then during the pandemic, we found that if you were not omni ready and you were not flexible in your business model, you went out of business if you're a small business. You had to have a website, you had to have the ability to take orders online, you had to have the ability to at least facilitate, take out or pick up at curb, maybe not even in the store, you have potentially the ability to deliver. And if you plain and simple just did not have that flexibility or unfortunately, the manpower, if you and I lose people, it's a bummer, but if you have 10 employees and you lose 2 of them, it's a lot more than a bummer. It's a 20% reduction in your workforce overnight. And you mentioned working for a smaller organization. That's one of the things I really realize, Dave, is how they can be impacted. Somebody hasn't -- because there would be all the same things happen, whether you have a death in the family or a woman is going to have a baby or somebody just -- this great resignation, decides to just bow out and resign. Again, it's a pain for you and me. It creates some frustration. But ultimately, for the small business owner, it's even more defined. So what Dave was referring to is we started tracking in the early months, and we were just seeing big increases in merchants that had previously -- or businesses that had previously given at least multiple transactions in a day or a week, a month, whatever, and how many went to 0. And it was pretty frightening. I hear estimates that upwards of 50% of the restaurants in Manhattan where I am today, closed over the course of this last 2 years, I was talking a day before we came out about San Francisco where we're headquartered. And I was out there a couple of weeks ago. And the city is really pretty dead. Lots of businesses out of business. And a lot of companies haven't brought their employees back and very, very difficult. So we sort of get better. I haven't seen numbers in the last couple of months, but it was starting to come back. And obviously, we're seeing new entrances as well, Dave. The second thing you asked me about was...

Number of first-time e-commerce users, how people transition and that's the -- kind of the acceleration on the pandemic?

It's been amazing, particularly in the U.S., Europe and Latin America. And let me give you an example of how it was -- had impact. So in Latin America, up until about 3 quarters ago, and this goes back in history for a long time. The use of debit cards to get cash exceeded the use of debit cards to purchase items. And in the last 3 quarters. We've seen a 6.5 point swing. So we've gone from 49% of the volume was to buy goods and services with a debit card, last quarter, it was 55%, which is -- these kind of swings are -- that's huge. Latin America is a pretty good sized region for us. And by the way, during this time, cash grew 10%. So a lot of that is because millions of people in Latin America for the very first time during the pandemic went online to start to shop. And try as you might, you can't get cash or check stuffed into your iPad or your phone, you're going to use the digital credential. And that was one of the -- that first time use and that adoption of e-commerce literally is starting to change the overall dynamic of an entire region that has been more cash-centric than digital-centric. And I think that's telling. In the United States, we saw in the last year, a 20% increase in the number of people who activated in e-commerce for the first time. And we saw increases in the average basket or the average ticket price, if you will. And I'll make one last point on this, which is one of the things that's been interesting during the pandemic is that we've seen the average ticket go up. And that's a factor of 2 different things. One is that debit cards have been increasingly used in e-commerce, but the baskets are bigger. So people are -- instead of running to the supermarket and buying 3 things and then going the next day and buying 3 things, people are getting online and putting an overall order in and it's just -- it's a bigger ticket. But the other thing that's happened is because people -- millions and millions of people around the world are not going to the office at all or as much as before, we're losing all those low-ticket transactions where you buy a cup of coffee in the morning and then maybe buy a bagel or pick up a sandwich at lunchtime or pay for your ticket for the bus or the train or the subway. So we actually saw average ticket price for both debit cards and credit cards rise during the pandemic. I expect it to normalize as we start to see people come back to the office. Although, I was hearing this morning on the radio that because of the -- Russia situation is going to obviously further impact fuel cost, that, that would put pressure on people like you and me and other CEOs in the audience where employees are saying, "Well, it's too expensive, and I'm nervous about getting on mass transportation. So I need more flexibility to stay home even more." So it's going to be interesting how this element actually plays out over time, Dave.

Hold that thought because I would love to get to the future of work, and we got -- that's fascinating. So you've got such a pulse and a command of what's going on in the economy. And you touched on transit payments that's expanding. So the expansion of the universe of digital commerce started well before the health pandemic. But as you said, so many people are getting more comfortable with the frequency of use and the necessity of using online commerce. And baskets size are increased, the range of products are increasing, new form factors, P2P, obviously. We don't have a lot of time left and I got a couple of topics I really want to get to. So I got to pivot to crypto. And certainly, a lot of discussion, you've started to stake a space in the crypto arena and wallets. I'd love to get your take on how you define the crypto space and the role Visa is going to play in the short and long term?

So I divide crypto first into 3 categories: what I call digital gold, which is non-fiat-based crypto where Bitcoin would be the star of the show. Second is stable coins, where it's a crypto currency that is actually backed by a reserve currency somewhere in the world. And then thirdly, central bank digital currencies, which are obviously all over the map with China being upfront there, but in some countries, really nowhere and others somewhere in between. As it relates to crypto, therefore, what are we doing? Well, first and foremost, we're just facilitating the purchase. Now not every bank is comfortable doing it. But we're -- the amount of particularly Bitcoin, to a lesser degree, stable coins that were purchased during the last 2 years, it's actually quite incredible. It -- combined with the -- I guess, people sitting at home really drove people to their computers and drove up the interest in crypto. I think crypto benefited from the pandemic because people, they are interesting enough, the only entertainment category that did anything during the pandemic was gaming online. It was up like 200% versus what it was before. So first and foremost, we're facilitating the purchase of crypto currencies. Secondly, we're creating a utility for them, so -- as it relates to stable clients. So we've partnered with over 60 crypto stable client providers, where they're putting Visa cards in their wallets, allowing people to convert from -- convert their crypto back to fiat and therefore, be able to use that Visa card to shop anywhere that Visa is accepted around the world. And so that's the second thing we're doing. The third thing that we're doing is enabling financial institutions and fintechs to be able to offer customers the ability to buy, trade and custody crypto through a relationship that we have with the first federally chartered crypto bank in the United States. The fourth thing that we're doing is working on settlement. Tonight, like every night, we settle in, I think it's 26 different currencies, and we're now working on settling in crypto. Again, it will be stable coins not something like a Bitcoin. And then lastly, we're working with central bankers around the world to make sure that anything that happens is in a private public partnership. Obviously, if the Central Bank believes that they should have a digital Canadian dollar that's -- their wisdom is that's the case, they still should be using RBC as their partner to facilitate the use of that and the network on which that's used. And we're trying to make sure in our role that we play in the larger ecosystem that frankly, everybody stays in their swim lanes because as you well know, David, the ecosystem is what it is because a lot of players play different but important and integrated parts and that needs to be true of crypto. I don't know where crypto is going to go. It certainly feels like a great application in emerging markets where cash is dangerous. And there aren't a lot of options for acceptance. I don't know what role it really plays in a Canada or in the U.S. to be perfectly honest. I've actually asked the Fed in the United States, what problem are we trying to solve? And it's not clear to me what that is. I'm not sure it's 100% clear to them as well. And you can see, you might have seen this morning, I haven't got the chance to read it yet, but President Biden signed some executive order trying to "rein in" crypto, and I don't know where all of that's going to lead as well. But similar to wallets, similar to buy now pay later. We want to be there and lean in and help our clients in any way we tend to understand it, to debate how it might be used, et cetera. So we're going to continue to lean in. We'll decide -- actually, as I said, the consumer will decide whether it makes any sense or not.

No, I think you've framed it really well. You've got an asset class that will continue to be an asset class along -- as someone wants to buy it and hold it for value, and you've got a stable coin that's backed by a more stable monetary source and then you've got the central bank currencies. And I appreciate your pitch for banks. We certainly communicated that to a number of central banks that to lend money, you have to store money. And if you're disrupted by the central bank and the storage of money, and I don't think they're ready or society is ready for them to be the lender of record in an economy. So however, we approach and whatever problem we're trying to solve with central bank digital currency has to leverage the existing financial system or else we have a major reordering of our economy in front of us as a dangerous -- so it's a really important point that I wanted to make sure is impressed upon our audience. I got a couple of ways I can go here in our last few minutes, but you did touch on how important small business was to our economies and to our communities and having led one and worked in one, but having supported them and served them. But when we get to ESG and talking about social good and the earning our license to operate as capitalists, I think you've really walked the talk. And it's -- I'd love you to talk about what you're doing around helping small businesses digitize and some of the work your doing in Africa. And you're really trying to make a quantum difference from some of the learnings and the trends that you saw during the pandemic, your commitments to helping small business are really impressive. I'd love you to talk bit on there?

So in ESG, in general, we're obviously doing internal things that are important, ranging from -- we've gotten to 100% renewable electricity, 70% of our buildings are LEED certified, et cetera. And all of that's important to do and we'll continue to do. We've made a commitment to be Net Zero by 2040. But I think to your question, there's 2 other areas where we've been focused. One is helping small businesses become digital, educating them, providing tools for them. We've also been leveraging our foundation, especially in places like Southeast Asia and Africa and parts of South America to help uplift small businesses, which, by the way, Dave, increasingly outside the United States are women-owned and minority-run. And it's a well-known fact that access to capital for women and minorities is less than men and people who are white, and we've got to break that down. We believe at Visa that it's critical that -- what our estimate is that there's 1.7 billion people on the face of the earth who are outside the financial mainstream, and we want to bring them into the financial mainstream. The last thing we're doing, which is kind of interesting is we're creating a set of eco benefits and we're rolling them out in Europe first, where somebody can have the ability to understand based on their buying, what their carbon footprint, their individual carbon footprint is. We're looking at a form of plastic that's recyclable. We're looking at people being able to buy carbon offsets on their issuer card to reduce that carbon footprint that they calculated. We're, in some cases, working with issuers to facilitate, in essence, kind of a cashback program, but the beneficiary wouldn't be the card member, but it would be a donation to an environmentally sensitive organization. So there's a whole bunch of things that we're trying to do and we'll continue to do in this space. I think there's much, much more to do. And especially in the area of what they call Scope 4, which is climate for good, which is in its early days, but something we're very committed to try to do our part in.

And you've also -- those are -- that's fantastic on the green stuff, but you've also committed from what I understand, maybe I'm holding it wrong, but to really help digitize a significant number of businesses globally?

We made a commitment to digitize 15 million small businesses around the world in 3 years.

15 million?

And after the first year, we're a little bit ahead of pace. So it's something that in our 125 offices around the world in 80 or 81 countries, it's a big focus for us. And that's where it starts. It starts on the ground. As you know, Dave, this payments business is money movement business, funds movement is a very local business, and it's different by country, based on traditions and rules and history and frankly, the level of innovation of the banks and the technology of the banks that are there and the size of the fintech community. So locally, it's a real rallying cry for our people to try to help small businesses digitize.

Trying to sneak in 2 emerging trends, which I hope forms a future session like this. This has been awesome. Quantum computing and IoT. Any thoughts as to timing?

Yes. Look, I think I think quantum computing is still a ways out, which is, in some ways, good. I'm worried about the bad associated with quantum computing as well as the good. Unfortunately, as my risk officer constantly reminds me is that the bad guys have equal access to the same technologies we do. And the view is I haven't been -- fully studied this, that quantum computing could really break down much of the encryption algorithms that we have today that help protect us. The Internet of Things I'm very excited about. We just actually introduced something called Visa Acceptance Cloud, which is moving all of the technologies and all the intelligence built into a terminal into the cloud and allowing for a very dumb terminal at the point of purchase. And I think that's going to be -- it's going to be really helpful in emerging markets, it's to be helpful in developed markets where there might be a free market in a local suburb of Canada or suburb of New York or a street vendor selling food, who today doesn't have -- can't afford to have this POS terminal there. But I also think when we think about IoT and the ability to buy from your home or from a gym, take a gym class and as gyms get smarter, there's going to be so many IoT applications that I think that the Visa Acceptance Cloud will help facilitate. So I think IoT is without question going to come, I think it's just a matter of the pace of it and the breadth of it over time.

And to the benefit of Visa, it's going to explode where goods and services are exchanged.

It's going to bring them out to many, many more end points.

Exponentially. They'll change our economy and Visa is poised to be at the middle of that. I've got 4 more topics, but we've run out of time. Thank you for your insights from all the work you're doing to help keep our society safe. And thank you again for the care and compassion you're leading in and the work you're doing to help our countries impose sanctions and bring order to our society that is really meaningful work in us. Thank you for sharing that. Your vision for the future, how you track the economy, your command of the change of payment factors. You're at the center of all economies and just your views on crypto to IoT to, obviously, cybersecurity. We didn't push quite as hard today. Thank you. Thank you for being our keynote speaker. Great insight, and I really appreciate you doing this today.

Dave, it's always a pleasure to be with you. I enjoyed it as well. And I hope your audience got something out of it, and I look forward to doing it again and I certainly look forward to seeing you in a couple of weeks. So thank you. Thank you to everybody.

Be well. Thanks again.

Thanks. Bye-bye.

Bye now.