MasterCard Strengthens m-Commerce - Analyst Blog


Expanding its mobile commerce (m-commerce) initiatives, MasterCard Inc. ( MA ) announced its intention to acquire a globally leading mobile-device payment technology developer - C-SAM Inc. for undisclosed terms and value. The deal is scheduled to culminate by Mar 2014, upon the receipt of regulatory approvals.

C-SAM offers software and other services to mobile-device wallets across the US, Japan, Vietnam, India, Singapore and Mexico, based on near-field communication (NFC). These include device application and infrastructural software services customized coupons, loyalty incentives, banking, bill-pay options and non-financial secure transactions.  

Subsequently, the acquisition will equip MasterCard customers with the latest ultra-modern digital service platform that offers quick, secured and relaxed mode of payments for their purchases. The company has had operational alliances with C-SAM since Dec 2012, when the former had investment in a minority share of the latter.

MasterPass Blends with Mobile Apps

Foraying into the innovative digital payment services space and simplifying payments for customers, MasterCard concurrently unveiled its latest next generation digital service - MasterPass for mobile applications.

Accordingly, MasterCard provided a very compact digital wallet. MasterPass will now allow smart and simple checkout services by using the NFC process to scan bar codes and pay through application within mobile devices. This will make point of sale transactions much more easy and secure, thereby enhancing the consumers' shopping experience. MasterPass for mobile applications is expected to be rolled out in second-quarter 2014.

Such long-term organic growth strategies are crucial and should prove beneficial for sustaining competitive pressures. Top-line growth from mobile applications are estimated to escalate more than five-fold from the 2011 equivalent of $8.5 billion to about $46 billion by 2016, according to ABI Research. Hence, the market acceptance for mobile payments boost management's optimism of delivering strong financial and operating growth in this field in the near future.

MasterCard curently carries a Zacks Rank #3 (Hold). Better-ranked financial service providers include Global Payments Inc. ( GPN ), Envestment Inc. ( ENV ) and Verifone Systems Inc. ( PAY ). All these stocks carry a Zacks Rank #2 (Buy).

ENVESTNET INC (ENV): Free Stock Analysis Report

GLOBAL PAYMENTS (GPN): Free Stock Analysis Report

MASTERCARD INC (MA): Free Stock Analysis Report

VERIFONE SYSTMS (PAY): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ENV , GPN , MA , PAY

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