Charles Scharf is set to step down from his position as Visa Inc’s chief executive to be replaced by a former American Express president, the company said on Monday.
Visa said in a statement that Scharf’s retirement as its CEO will become effective on Dec. 1. He will be replaced by former American Express Co. President Alfred Kelly, who is already a member of the company’s board of directors.
“We’re in a very unique position where we have someone who has over two decades of experience in payments and is also very, very knowledgeable about Visa,” Scharf said of Kelly in a phone interview, as reported by Bloomberg.
The Visa CEO, who will serve as adviser to his successor for several months, believes the transition will be smooth-sailing given the experience Kelly brings to the table.
On his part, Kelly, a former White House officials, told Reuters that he was already familiar with the opportunities and issues facing Visa, having been a board member since 2014.
“I don’t come in here expecting to make a lot of big changes,” the new Visa CEO said.
He told analysts via a conference call that it would be a “colossal mistake” on his part to come in and begin wholesale changes considering how “extremely well” the company has been doing under his predecessor.
Scharf, who became Visa CEO in November 2012 after Joe Saunders, said his resignation was based on the fact that he could no longer afford spending significant amount of his time in San Francisco, as required by his position. The 51-year-old wanted to be closer to his family.
Over the years, Scharf has had to spend more time at the headquarters of the world’s leading payments network in San Francisco. His family was based in New York.
The value of Visa has more than doubled since he became chief executive. The 137 percent rise recorded under his watch was the second-highest in the Dow Jones Industrial Average, according to Bloomberg. He successfully oversaw the re-establishment of link between the global payments technology company and its European affiliate Visa Europe in June.
Scharf worked in the retail banking division of JPMorgan Chase & Co. and at its private equity arm before moving to Visa. He may be considered for compensation of about $20 million if his complaint about location and travel issues is considered good enough to justify his request for retirement.
Kelly will look to continue where Scharf left off by maintaining and building on Visa’s standing as the world’s biggest payments network in the face of rising competition from online payment processors, such as PayPal. He will also have to deal with mounting challenges facing the company.
During his tenure, Scharf has had to deal with multiple challenges over fees Visa charges on transactions. This include a federal appeals court ruling in June to reject a settlement with retailers accusing both the company and rival MasterCard of improper fixing of fees on credit and debit card payments. The San Francisco-based firm is also locked in legal tussle with Wal-Mart as regard use of PINs for verification of purchases.
The new Visa CEO has expressed readiness to spend more time in the city where the company’s headquarters are located. He said he was ready to be at “anywhere I’m needed.”
Kelly joined American Express in 1987 and became the president of its consumer unit in 2007. The 58-year-old left the company in 2009.