Visa Payment Systems Outage Across Europe Over

by Ike Obudulu Posted on June 2nd, 2018

London, UK: Visa, V, the payment systems giant, says it has resolved a technical issue which occurred yesterday in Europe and prevented millions of people from using Visa for payments for goods and services.

People started experiencing trouble with using their credit and debit cards Friday past noon in Europe, according to local media. Major retailers and gas stations reported the transaction failures which caused building up queues.

The issue was the result of a hardware failure within one of Visa’s European systems and is not associated with any unauthorised access or cyberattack.

Visa Europe’s payment system is now operating at full capacity, and Visa account holders can now use Visa for any of their purchases and at ATMs, as they normally would, the company said in a statement today.

“Our goal is to ensure all Visa payments work reliably 24 hours a day, 365 days a year. We fell well short of this goal today and we apologise to all of our partners and Visa account holders for any inconvenience this may have caused,” Al Kelly – Chief Executive Officer, Visa Inc.

Paymentsense, which provides card machines, online payment gateways and virtual terminals to some 60,000 independent businesses in Britain and Ireland, advised users to try paying via contactless transactions.

After the hardware issue was resolved, Paymentsense said customers continued to experience “intermittency” because of a backlog in transactions.

In Spain, the Guardia Civil assured customers on Twitter, saying: “If you cannot pay, you have not suffered any theft or hacking.”

Russia was spared the chaos as it has its own National Payment Card System (NPCS) to prevent western sanctions creating a financial crisis.

“In Russia, all card payment transactions are proceeding normally and no problems are being observed,” TASS news agency quoted a spokesman for the NPCS as saying late on Friday.

France was also exempt from the issues, according to the French Association of Bank Users (AFUB).

“The explanation is probably related to the fact that in most European countries merchants are in direct contact with Visa when paying, while in France the payment passes through an intermediary,” secretary general Serge Maitre told reporters.

The Royal Bank of Scotland said cash machine withdrawals were unaffected.

Lloyds Bank said: “We are aware of an industry wide issue effecting Visa payments which is under investigation.

“ATM and Mastercard transactions are not impacted. We are working to resolve the issue as quickly as possible.”

Worldpay, the UK’s leading payments provider, said: “Customers may be seeing intermittent transaction declines due to an issue Visa is currently experiencing in Europe with all acquirers.

“We will provide an update as soon as we have one.”

£1 in every £3 spent in the UK is on a Visa card.

The extent of the problem, which Visa called a “service disruption”, has not yet been clarified. Visa has also not commented on whether retailers will be compensated for lost earnings.

Many businesses posting signs that advised customers to either use cash or cards offered by Mastercard Inc. MA, or American Express Co. AXP.

Visa and Visa Europe remained separate entities when Visa proper went public in 2008, but Visa acquired its European counterpart in 2016. The Visa Europe integration is part of the bull case for Visa’s stock, as some analysts see opportunity ahead as the combined company restructures arrangements and makes technological upgrades in Europe.

Shares of Visa, V, were up as much as 1.4% earlier in the day but traded down 0.1% in Friday afternoon trading, while Mastercard shares are up 2.6%. Visa’s stock has gained over 14% year-to-date, compared with a 2% gain for the S&P 500 index SPX.

The Visa Inc. outage in Europe Friday has emboldened critics who advocate a slow down in the march by the Credit-card networks towards a cash-free society.

Even at the national level, Australia, for instance, has moved to ban cash transactions Over $10,000 starting in 2019. Citing the necessity of fending off tax cheats, drug-money laundering and terrorism, Canberra will outlaw the use of cash for any transaction above $10,000, sparking new fears of increased surveillance and control in a digital society. Beginning in July 2019, it will be illegal in Australia to make any purchase in the amount of $10,000 or greater in cash, as privacy advocates note that the use of checks or credit/debit cards connected to banking institutions is the perfect surveillance tool

Author

Ike Obudulu

Ike Obudulu

Versatile Certified Fraud Examiner, Chartered Accountant, Certified Internal Auditor with an MBA in Finance And Investments who has both worked for and consulted with some of the world's largest companies on main street and wall street in over 20 countries, Ike brings his extensive reporting and investigations experience to bear on his role as Chief Editor.
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