The artificial intelligence data center build-out is grabbing all the attention. However, investors shouldn’t ignore durable secular trends that have stood the test of time. The ongoing decline in cash usage has been a powerful story.
Visa (NYSE: V) sits atop this movement. This financial stock provides investors with an excellent way to bet on the cashless economy.
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Scale is unmatched
Visa dominates the digital payments landscape. Investors can look at one key data point to understand exactly why.
During its fiscal 2026 second quarter (ended March 31), the business processed $4.4 trillion in total payment volume (TPV). That figure increased by 142% in the past decade. For comparison, on an annualized basis, this represents about 15% of the entire world’s gross domestic product (GDP).
This company quite literally enables commerce to happen on a global stage. Visa is used in more than 200 countries and territories, showcasing its broad reach. Its TPV reveals just how much influence it has on the declining usage of cash and paper-based transaction methods.
A network effect supports the competitive position
There are 5 billion Visa cards in use around the world, and 175 million merchant locations accept them as a form of payment. At a high level, this creates an incredible network effect. Because Visa has such wide acceptance, people need to have these cards in their wallets. Because there are so many of these cardholders, merchants almost have no choice but to accept Visa in an effort to avoid losing sales.
This network effect supports the company’s powerful competitive position. It’s almost impossible to disrupt Visa, given its entrenched position with merchants, consumers, and banks. Businesses trying to threaten this setup not only need to introduce payment solutions that are significantly better. They also need to figure out how to achieve adoption.
Growth is sustainable
Visa isn’t going to impress investors with outsize revenue gains, but growth has proven to be extremely durable and resilient.
In the past decade, revenue rose at a compound annual rate of 211%. Besides a 5% decline in fiscal 2020 (due to the pandemic’s negative effect), the company’s slowest pace of growth was an 8.7% increase in fiscal 2016. Based on consensus analyst estimates, fiscal 2026 will be Visa’s sixth straight year posting a double-digit sales jump.