Peter Scriven

'We have started the acceptance of Visa in a limited number of outlets,' says Regional General Manager Peter Scriven. 'Before sanctions were lifted we were just not allowed to handle transactions in Iraq.

'We expect transactions to pick-up now as more and more foreign visitors come to Iraq, and see this as a very important market for the future with huge potential for the development of Iraq's retail banking sector. It's of course good for Visa's business, however more importantly we also hope that Visa will be good for Iraq in helping to modernize payments.

'Visa strongly believes that electronic payment plays a vital role in the development of local economies. Through the improvement of Iraq's retail payment systems, and the eventual increase in Iraq's banked population, additional sources of funds would be available to the economy in the form of bank deposits that can be further invested in economic development and growth.'

The global card giant operates in Iraq through its Jordan office, and is accepting payments in a number of hotels and tourism and leisure outlets. These are exciting times in the region for Visa which is not only extending its reach into Iraq.

'In Syria we are already at the merchant acquiring phase and we hope to announce an agreement with the Commercial Bank of Syria soon,' says Mr. Scriven, an eight-year Gulf financial services veteran. 'It's another big market for us and another opportunity to help develop the country's retail banking industry'.

Since Mr. Scriven arrived in the region Visa has made considerable progress in advancing the use of credit and debit cards and overcoming its arch rival, cash. Indeed, Visa has a 70% market share of the card payments market, though cash still accounts for 95% of total transactions in the Middle East.

'We just continue to work on providing excellent customer service and value added for cardholders and by doing so showing the multitude of benefits of cards over cash. Customer service is still the biggest challenge,' he says. 'But in Bahrain and the UAE we have reached the stage where the use of electronic point-of-sale outlets is higher than ATMs, so that means we are winning the battle against the use of cash'.

That said some unscrupulous merchants are ripping off cardholders by applying big surcharges to card payments, although their agreement with Visa expressly prohibits them from doing so. 'The provision of extra discounts allows them some flexibility, but most reputable merchants don't do it any more,' explains Mr. Scriven.

For the future the Visa boss predicts that the downward pressure on card fees will continue due to strong competition, and that the range of card benefits will further expand. He thinks competition is a good thing and that different value-added benefits suit different target audiences.

New technology will also continue to widen the appeal of Visa cards. But Mr. Scriven notes that at least one major UAE bank has abandoned an automated voice answering system and returned to human service, and that technology always has to be careful not to compromise customer service.

That is not to say that Visa is abandoning new technology, far from it.. Visa is actively launching pilot schemes for m-commerce initiatives that allow users to top up their pre-paid cards from a mobile phone or make person to person mobile payments. Also by the end of this year more than 120,000 smart cards with chips embedded in them will be in issue in the UAE, and banks are preparing a multifunction strategy based around these smart cards.

'E-commerce is growing by 50% per annum but it could still be higher,' says Mr. Scriven. 'And Government payments services are also making progress particularly in Jordan. But these are both areas for further expansion.'

There is no doubt that the future still lies with electronics payments based around credit and debit cards, and Visa maintains a lead in this field in the Middle East with newcomer MasterCard still struggling to compete.