Magazine article American Banker

MasterCard Highlights Digital Wallet Expansion in Strong Quarter

Magazine article American Banker

MasterCard Highlights Digital Wallet Expansion in Strong Quarter

Article excerpt

Byline: David Heun

MasterCard's digital wallet is currently live in 10 markets and the company has plans to add four more countries this year in a push to strengthen the card network's capabilities in an increasingly digital world.

MasterPass demonstrates the Purchase, N.Y.-based company's commitment to technology and innovation, said Ajay Banga, president and CEO of MasterCard, during the company's second-quarter earnings conference call.

"It is more than a wallet," Banga said during the July 31 call. "It is a platform for payments, it is live in more countries than other wallets and we have tens of thousands of merchants signed up for accepting it."

The company is about to deploy in-application payment capabilities for MasterPass, which allows companies like Starbucks to include a MasterCard prepaid card in its mobile payment and loyalty application in the Australian market, Banga added. Shaw Theatres in Singapore also supports the MasterPass in-app purchasing feature.

The updates to MasterPass come as the rival card network Visa is revamping its own digital payment strategy under the new Visa Checkout brand.

MasterCard's net income rose 10%, to $931 million, from the same period a year earlier. Its net revenue rose 13%, to $2.4 billion.

MasterCard reported an increase in processed transactions of 12%, to 10.6 billion, and an increase in cross-border volumes of 16%.

MasterCard is showing strength in many sectors of its business, but it may be too early to declare MasterPass as the gold standard of digital wallets, said Gil Luria, analyst with Los Angeles-based Wedbush Securities.

"MasterCard has an entry with MasterPass but the company focuses on supporting their bank members more so than having their own proprietary brand," Luria said. "The real test is how many banks deploy a MasterPass and how many have success gaining merchant acceptance and consumer adoption. …

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