Visa President for Central and Eastern Europe, Middle East and Africa Andrew Torre talks to Economy Middle East about how digitalization is reshaping mobile payments, shopping, e-commerce and more. Andrew Torre believes further disruption is on the horizon and shares how Visa intends to continue its leadership position in the industry by reaching out to more consumers and merchants, driving more engagement and improving the ‘point of experience’.
What are your perspectives on recent global economic performance and future outlook?
Despite several challenges, the world economy has shown remarkable resilience over the past 12 months. We have seen ‘a great economic reboot’ with robust employment and declining inflation, after the turbulence of the pandemic and subsequent inflationary pressures. Looking ahead, projections for global GDP growth in 2024 suggest a cautious but positive phase of momentum as interest rates potentially decrease.
Closer to home, the Central and Eastern Europe, Middle East and Africa (CEMEA) region continues to present significant growth opportunities. This economic resilience emerges from several factors, including elevated energy prices, thriving inbound tourism and investment in broader industries, which builds diverse economic strength.
The future looks extremely bright. Almost one in four of the world’s population lives in CEMEA and many are young, urban and digital-first. In the Middle East alone, 32 percent of the population is under 15. Positive trends such as expanding access to the digital economy, rising financial inclusion, increasing urbanization, and improved infrastructure are further boosting the region’s growth potential and driving significant optimism.
Within this context, how are digital payments evolving across the CEMEA region?
We continue to see impressive, unparalleled digital payments growth across CEMEA and throughout the Middle East. Over the past four years, digital payments have grown at more than 30 percent a year, and we have seen the proportion of cash decline by around a third. The strong growth momentum that was underway continued through the pandemic and has accelerated beyond.
There are many positive enabling forces – changing consumer behavior, supportive government initiatives, the rise of fintech and an increase in tokenized mobile payments. The industry has also taken giant strides forward in putting incredibly strong foundations in place. Today, there are more than 350 million Visa credentials across the region, and in excess of 11 million merchants that accept digital payments. We have seen incredible acceleration, and firmly believe that the region is set for a next wave of digital disruption, with more opportunity than ever.
How has this digitization shifted consumer preferences in retail?
The pandemic fundamentally reshaped shopping behaviors and brought significant changes in consumer expectations and demands. The rapid growth in e-commerce, alongside the recovery and resurgence of in-store purchases, has led to the rise of ‘phygital’ retail, where physical and digital shopping experiences are increasingly intertwined.
Our latest Global Digital Shopping Index revealed that 71 percent of consumers still find physical stores central to their shopping experience. We also heard that 31 percent prefer a hybrid experience, seamlessly blending online and offline shopping – reflecting the rise of ‘click-and-mortar’ shoppers. This integrated approach provides a more seamless and personalized consumer experience, combining the convenience of online shopping with the personal nature of in-store.
Convenience is king. Over the past few years, the share of contactless payments in-store grew from single digits to more than 86 percent, and over half of those payments are made with mobile devices. For today’s consumer, smooth, secure and convenient payment methods are critical.
What are some of the innovations emerging to enhance the shopping experience?
We increasingly see that consumers want choice and control in their spending. We recently partnered with Abu Dhabi Islamic Bank to launch Visa installments. This solution allows ADIB Visa cardholders to split their purchases into smaller, equal payments at the point of sale. This gives consumers more flexibility and control over their spending, as they can choose the payment plan that suits their cash flow. The Visa installments solution also benefits merchants, as it can help them increase sales volume and improve customer loyalty. By offering this convenient and tailored payment option, we are catering to the consumer demand for personalization and convenience in the digital age.
How has the digital era influenced consumer behavior and loyalty?
We are seeing substantial shifts in loyalty, and innovative schemes, such as those offering gamified rewards or discounts for sustainable travel options, are setting a new standard. It’s not just about transactional loyalty anymore, but about creating an emotional connection and delivering experiences. In addition to that, we’re seeing new consumer demographics emerge, including in the Gen Z segment, such as video gamers, who are driving significant spending. Content creators and influencers are also playing a pivotal role in shaping consumer behavior. These trends emphasize the need for businesses to be agile, to adapt their strategies and to invest in digital infrastructure. This is crucial to drive sustainable growth and recovery in an ever-evolving economic landscape.
During times of such rapid digitization, how is Visa ensuring the security of its global network and preventing fraud?
We have always taken a multi-layered approach to security that leverages advanced technology, industry-leading security practices, and continuous monitoring. Over the past five years, we have invested more than $10 billion in technology to facilitate rapid and secure transactions and gain unparalleled insight into fraudulent activities.
By implementing proactive measures and leveraging advanced fraud detection systems, we were able to avert $40 billion in potential fraud last year. This underscores our unwavering commitment to preserving the integrity of our payment ecosystem and safeguarding the interests of consumers and businesses alike.
Across the region, we are also working to empower consumers with the knowledge they need to protect themselves. Our Stay Secure initiative focuses on raising awareness about the latest threats and preventive measures by educating consumers on safe online practices, the importance of secure transactions, and how to identify potential scams.
Collaboration is another cornerstone of Visa’s security approach. We work closely with enforcement agencies worldwide and are extremely proud of our partnership with the Dubai Police, where we combine resources and expertise to tackle financial crime. By working together, we are better equipped to confront and overcome the challenges posed by fraudsters, helping secure the financial interests of consumers and merchants alike.
There is significant interest in Artificial Intelligence. How is Visa harnessing the power of AI to enhance payments?
Our journey in AI began over 30 years ago. Back in 1993, Visa became the first network to deploy AI-based technology for risk and fraud management and pioneering the use of AI models in payments. Over the past 10 years, we invested more than $3 billion in AI and data infrastructure to enable the safer, smarter movement of money and to proactively identify and prevent fraud. We are constantly adapting to the ever-changing digital landscape.
By implementing real-time AI decision-making, we’ve seen a marked improvement in our fraud detection rates, and have strengthened our defenses against fraudulent activities, ultimately ensuring considerable revenue protection for our clients. Â Recently we introduced new AI-powered products designed to help financial institutions prevent fraud by blocking bad transactions before they happen. From real-time, account-to-account payment protection; expansion of Visa Advanced Authorization (VAA) and Visa Risk Manager (VRM) for non-Visa card payments; to Visa Provisioning Intelligence for combating token fraud, these solutions are enabling seamless and secure payment experiences across various devices and platforms.
How is Visa addressing the challenges of digital identity?
Digital Identity and trust are the gateways to financial inclusion and access to the digital economy. The lack of an effective, ubiquitous, human identification layer on the internet creates friction, risk and barriers to entry for consumers and businesses especially in emerging economies. The digital identity landscape is increasingly diverse, with contributions from governments, tech giants, and private sector initiatives. The shared goal is to make digital identities more accessible, secure, and efficient. Examples include government-led initiatives like the UAE Pass, technology firms centralizing IDs such as Apple’s ID Wallet, or private sector schemes facilitating data transfer. These efforts collectively aim to create a digital ecosystem that prioritizes convenience and security.
Addressing the challenges of the digital identity spectrum is critical for further progress. This includes addressing the significant number of individuals without biometric IDs in regions like CEMEA, streamlining Know Your Customer (KYC) processes that currently delay access to financial services, reducing e-commerce checkout abandonment through improved authentication processes, and enhancing the interoperability of ID systems to enable seamless data transfer across services and platforms.
For consumers, digital identity solutions offer enhanced security, privacy, and convenience. They address common concerns like the need for repeated document submissions and remembering multiple passwords. Furthermore, they are making financial services more accessible, simplifying government interactions, and significantly contributing to fostering financial inclusion.
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How do you see government efforts to build new payment infrastructures or introduce new products?
We firmly believe that the greatest progress can be made through public-private sector partnerships. We share government objectives in boosting the digital economy, driving growth and transparency, and improving access to digital payments amongst citizens and micro and small businesses.
Moreover, we welcome and encourage innovation and recognize the important role governments can play in accelerating digital transformation. We work closely with governments across the region to complement their ambitions to build modern, resilient payment infrastructures, and collaborate across many of their core priorities. In addition, we support governments with a range of innovative value-added services, including using AI to analyze transaction data in real-time and provide rapid risk assessment to help optimize the security of instant payments, and in introducing new products, such as CBDC-linked Visa cards.
With so much progress underway, where are you focused moving forward?
While significant strides have been taken, enormous opportunity remains to further expand digitization, including in consumer payments. We look at reaching more consumers, more merchants and driving more engagement, and improving the ‘point of experience’ is key. Whether introducing new consumer innovations that enhance the payment experience or supporting female entrepreneurs through Visa’s ‘She’s Next initiative’, we see tremendous growth potential.
Beyond consumer payments, there are wider opportunities for improved digital experiences. Consumers expect that money transfers should be as smooth and fast as making payments, but frequently still require too many clicks and steps. We are also working in the commercial space to support simpler B2B payments so that businesses can reduce administrative burdens and focus on their core businesses. Lastly, together with governments, we are helping modernize e-services and delivering better experiences for those accepting, making, or disbursing payments. It is an incredibly exciting time in digital payments, and we have the privilege to be working with clients and partners at the forefront of this change.
About Andrew Torre
Andrew Torre serves as the CEMEA regional president at Visa. In this role, he oversees all of Visa’s operations in around 90 countries across the Central and Eastern Europe, Middle East and Africa region.
Andrew Torre has been with Visa since 2002, holding global roles in product, strategy and pricing. He also held general manager roles in Russia and Sub-Saharan Africa. Also, Andrew Torre is a member of the President’s Advisory Council on Doing Business in Africa. An industry veteran, his experience outside Visa includes BankServ.
At BankServ, Andrew Torre served as general manager of the enterprise payments division. At Washington Mutual, he served as vice president of new product development and strategic planning. Andrew Torre has also worked with the World Bank in Kiev, Moscow, and CIS territories.
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