Can Visa Gain More Ground as Cash App Flexes Into Pay-Over-Time?

Core Insights - Visa Inc. is poised to enhance its market position as Cash App and Afterpay introduce a new pay-over-time feature that will be available wherever Visa is accepted [1][2] Group 1: New Product Launch - Cash App and Afterpay are launching the Cash App Visa Debit Flex Card, allowing eligible users in the U.S. to split everyday purchases into six weekly installments with a transparent finance fee [1][8] - This initiative aims to blend buy now, pay later (BNPL) habits with everyday spending, particularly targeting younger users who may be hesitant to use traditional credit [3][4] Group 2: Market Position and Strategy - By expanding pay-over-time options across Visa's extensive network, Block is enhancing the utility of BNPL while reinforcing Visa's role in new credit solutions [2] - The model is designed to evaluate cash flow patterns rather than relying on traditional credit scores, which helps manage risk by pausing access to new loans in case of repayment issues [3][4] Group 3: Competitive Landscape - Competitors like Mastercard and Affirm are also advancing in the BNPL space, with Mastercard introducing its own installment options and Affirm focusing on real-time underwriting and predictable repayment plans [5][6] Group 4: Financial Performance and Valuation - Visa's stock has increased by 4.6% over the past year, contrasting with a 14.1% decline in the industry [7] - Visa trades at a forward price-to-earnings ratio of 24.84, which is above the industry average of 19.74, and carries a Value Score of D [9] - The Zacks Consensus Estimate for Visa's fiscal 2026 earnings suggests an 11.7% increase compared to the previous year [10]