The initiative will support the next generation of companies dabbling in the intersection of generative AI and payments. Visa says the new fund will support firms at various stages of growth with a preference for companies in the early stages of their development.
Generative AI is a subset of AI focused on the synthetic creation of images, text, and videos. The technology rose to prominence following the release of OpenAI ChatGPT and Google’s (NASDAQ: GOOGL) Bard, platforms that can generate text and code with high expertise.
Jack Forestell, Visa’s Chief Product and Strategy Officer, noted that despite the multiple use cases of generative AI in content creation, the technology has myriad applicability in the financial sector. The initiative will be run by Visa Venture, the firm’s corporate investment unit, building on a track record of supporting global innovation since its establishment in 2007.
“While much of generative AI so far has been focused on tasks and content creation, this technology will soon not only reshape how we live and work, but it will also meaningfully change commerce in ways we need to understand,” said Forestell.
Visa says it has been using AI since 1993 to provide value in the financial sector with its pioneering attempt at fraud management. Since then, the company has developed its internal AI products to mitigate payment risks, saving over $27 billion from falling into the hands of bad actors via its real-time fraud monitoring solution.
In 2021, Visa launched a suite of AI products called VisaNet +AI, focused on resolving hitches associated with settling accounts by financial entities. Other AI tools in the suite include an offering designed to improve consumer experiences during posting and another to reduce delays stemming from outages by imitating approval decisions.
“With generative AI’s potential to be one of the most transformative technologies of our time, we are excited to expand our focus to invest in some of the most innovative and disruptive venture-backed startups building across generative AI, commerce and payments,” said Head of Visa Ventures, David Rolf.
Visa’s tango with emerging technology
Visa has a strong streak of investing in emerging technology, given its previous dealings with blockchain and Web3. As a result of its innovative stance, the company has been tipped to participate in several central bank digital currency (CBDC) pilots in several countries, including Brazil and Hong Kong.
In 2021, Visa disclosed its intention to build an interoperability platform for CBDCs and stablecoins to promote scalable and universal payments. Visa’s competitor, Mastercard (NASDAQ: MA), has also made a foray into blockchain and AI as both firms embark on a heated race for supremacy.
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