TLDR
- Citrini Research published a Substack article outlining a hypothetical 2028 scenario in which AI-powered agents circumvent traditional card networks, threatening Visa’s fee-based revenue model.
- Shares of Visa declined 4.5% during Monday’s trading session, ending the day at $306.52, with peer companies Mastercard and American Express experiencing similar losses.
- Mastercard shares decreased 5.7% while American Express posted a 7.2% decline in the same trading period.
- During Tuesday’s premarket session, Visa shares gained 0.2% to reach $307.09, representing a minor recovery from the previous day’s selloff.
- The company continues to navigate a proposed $38 billion interchange fee settlement with retailers that remains subject to court approval, creating additional uncertainty.
Shares of Visa Inc. experienced significant pressure on Monday following the publication of research suggesting artificial intelligence technology could eventually redirect payment transactions around legacy card processing networks.
The Monday trading session saw Visa shares decline approximately 4.5%, settling at $306.52 by market close. After opening at $319.04, the stock touched an intraday low of $304.71 before finishing near session lows.
The market movement was triggered by a Substack article from independent research firm Citrini Research, released on Sunday. The publication presented itself as “a scenario, not a prediction” — constructing a hypothetical financial newspaper dated June 30, 2028.
Within this speculative framework, the research outlined a scenario where U.S. unemployment surpassed 10% and the S&P 500 index retreated 38% from previous highs. According to Citrini’s narrative, widespread displacement of white-collar employment by AI technology served as the catalyst.
The research specifically identified Visa as facing potential vulnerability. The core thesis suggested that AI agents operating on consumers’ behalf might actively search for lower-cost payment alternatives, potentially undermining Visa’s 2%-3% network and processing fee structure.
The analysis proposed stablecoins as a possible alternative payment infrastructure — one that could bypass conventional card networks altogether.
An important clarification: Visa does not directly receive interchange fees. Those revenues flow to the banks that issue payment cards. Visa’s revenue stream comes from network access and processing charges, which rely on maintaining substantial transaction volumes and robust cross-border payment activity.
The market reaction extended beyond Visa. Mastercard shares fell 5.7%, while American Express declined 7.2% during the same trading day. Both Visa and American Express ranked among the Dow’s worst performers, based on MarketWatch reporting.
Tom Hainlin, national investment strategist at U.S. Bank Wealth Management, characterized the market behavior: “You’ve seen the market react to headlines, it’s ‘sell first, assess later.'”
Payment Sector Faces Broad AI Disruption Concerns
The widespread decline across payment companies highlighted growing investor concerns about business models that operate as intermediaries — extracting fees from each transaction that passes through their systems.
Market participants are debating whether Monday’s decline represents an isolated event or signals the beginning of a fundamental revaluation of such fee-dependent business models.
Pending Interchange Fee Settlement Creates Additional Uncertainty
Visa confronts ongoing legal uncertainty beyond AI concerns. Last November, both Visa and Mastercard proposed a restructured $38 billion settlement agreement with merchants concerning interchange fees. The agreement awaits judicial approval.
Retail industry representatives argue the proposed settlement remains insufficient. Stephanie Martz, general counsel for the National Retail Federation, stated: “You can’t just suddenly tell more than 80% of your card customers you’re not going to take their cards.”
By Tuesday’s premarket trading, Visa demonstrated modest improvement — climbing 0.2% to $307.09, recouping a fraction of Monday’s decline.
On the corporate calendar, Chief Product and Strategy Officer Jack Forestell is expected to present at Morgan Stanley’s Technology, Media & Telecom Conference on March 3. Commercial & Money Movement Solutions President Chris Newkirk has a scheduled appearance at the Wolfe Research FinTech Forum on March 11.
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