Visa plans 2,600 job cuts as payments giant reduces workforce by 7%

Visa is set to cut around 2,600 jobs as the global payments company looks to reduce costs and make its operations more efficient, Bloomberg News reported on Tuesday, citing an internal staff memo.

The job cuts will largely impact Visa’s technology and product teams, according to the report.

The payments processor is focusing on becoming more efficient in a challenging industry, with artificial intelligence helping reduce repetitive tasks and accelerate product development. However, AI was not the only reason behind the decision, Bloomberg reported, citing a person familiar with the company’s reasoning.

The company is scheduled to announce its quarterly results after the market closes on Tuesday.

The workforce reduction comes as other major players in the payments and fintech space have also announced job cuts this year. Earlier, Visa’s rival Mastercard said it would reduce its global workforce by 4% as part of efforts to redirect investments towards new growth areas.

Fintech company Block also announced in February that it would cut nearly half of its workforce, amounting to around 4,000 jobs.

Visa shares gained 2.2% in premarket trading following the report.

Visa is one of the world's largest digital payments companies, operating a global payments network that connects consumers, businesses, banks and governments in more than 200 countries and territories.

The company traces its origins to BankAmericard, a credit card programme launched by Bank of America in 1958, before adopting the Visa brand in 1976.

Visa Inc. was formed in 2007 after the consolidation of its regional businesses and went public in 2008 in one of the largest initial public offerings (IPOs) in US history.

Unlike banks, Visa does not issue credit or debit cards or lend money directly. Instead, it provides the technology and network that enable electronic payments between financial institutions, merchants and consumers. Today, Visa processes billions of transactions every year and remains one of the world's biggest payments companies by market value, competing with rivals such as Mastercard and American Express.

(With inputs from agency)