Visa Partners with Yellow Card to Expand Stablecoin Payments in CEMEA

Visa, a global leader in payment processing, has announced an expansion of its stablecoin operations into Central and Eastern Europe, the Middle East, and Africa (CEMEA) through a strategic partnership with Yellow Card, a leading African cryptocurrency exchange. This initiative seeks to integrate stablecoin technology, primarily USD Coin (USDC), into Visa’s payment ecosystem to facilitate efficient cross-border payments, streamline treasury management, and enhance liquidity solutions for businesses and consumers in these regions. The move marks a significant step in Visa’s ongoing efforts to bridge traditional financial systems with blockchain-based solutions, particularly in emerging markets where access to affordable financial services remains a challenge.

Partnership Details and Objectives

The collaboration with Yellow Card, which operates in 20 African countries and serves over 1.5 million users, leverages the exchange’s robust infrastructure to enable stablecoin-based transactions. Founded in 2016, Yellow Card has processed $6 billion in transactions across Africa, demonstrating its capacity to handle significant transaction volumes. Visa aims to utilize this infrastructure to pilot stablecoin payment programs, starting with at least one African country by year-end, with plans for broader adoption across the CEMEA region. The partnership focuses on use cases such as cross-border remittances, merchant settlements, and liquidity management for enterprises, addressing high transaction costs and inefficiencies in traditional banking systems.

Visa’s stablecoin initiative builds on its prior success with USDC settlements. Since 2023, the company has processed over $225 million in USDC transactions through select clients, including merchant acquirers like Worldpay and Nuvei, using the Solana blockchain for its speed and low costs. The CEMEA expansion extends this framework, integrating Yellow Card’s regional expertise to tailor solutions for local markets. For instance, in Africa, where remittance fees can exceed 8.5% of transaction values, stablecoins offer a cost-effective alternative, potentially reducing fees and improving access for unbanked populations.

Market Context and Stablecoin Adoption

The global stablecoin market, valued at approximately $251.75 billion as of June, continues to grow, with USDC holding a significant share alongside Tether’s USDT. Stablecoins have gained traction for their ability to maintain price stability, making them ideal for payments and remittances in regions with volatile local currencies. In Africa, where around half of the population remains unbanked, stablecoin-based solutions could enhance financial inclusion by enabling low-cost, near-instantaneous transactions without reliance on traditional banking infrastructure.

Visa’s move aligns with broader industry trends, as payment giants increasingly explore blockchain technology. For example, Mastercard is also experimenting with stablecoin integrations, though Visa’s focus on emerging markets through partnerships like Yellow Card sets it apart. However, some users have raised concerns about the scalability of stablecoin payments in regions with inconsistent internet access or regulatory restrictions.

Regulatory and Operational Challenges

Despite the potential, Visa’s stablecoin expansion faces hurdles. Regulatory uncertainty remains a key concern, particularly in Africa, where some countries have imposed restrictions on cryptocurrency transactions due to concerns over consumer protection and anti-money laundering (AML) compliance. Yellow Card’s status as a licensed operator in multiple jurisdictions helps mitigate these risks, but Visa will need to ensure robust compliance measures to maintain trust with regulators and users. Additionally, the volatility of the broader cryptocurrency market, while less impactful for stablecoins, could influence public perception and adoption.