Foraying into the innovative digital payment services space,
) introduced the latest next-generation digital service -
MasterPass, which will facilitate customers a quicker, secured
and relaxed mode of payments for their purchases.
MasterPass is a step ahead in simplifying payments as it
allows payments both through a payment card or any device. The
payments can either be made electronically through any debit,
credit or prepaid card or through internet using devices such as
smartphones, computers, laptops and tablets. MasterPass is the
revolutionized form of PayPass Wallet, which was launched by
MasterCard in May last year.
Accordingly, MasterCard provided a very compact digital
wallet. MasterPass will now allow smart and simple checkout
services by using the near field communication (NFC) process to
scan bar codes and pay through mobile devices, thereby making
point of sale transactions much more easy and secure.
MasterPass also offers other value-added services like account
balance information, alerts on discount offers and loyalty
programs. These facilities further add to the consumers' shopping
experience. Initially, MasterCard's MasterPass will be made
available in the U.S., Canada, U.K. and Australia. Subsequently,
the services will be accessible globally.
Global Expansion is the Key
MasterCard's MasterPass has received a warm reception from a
number of financial institutions, banks, merchants and technology
partners. Concurrently, VeriFone Systems Inc. joined forces with
MasterCard to combine MasterPass' latest services with the
former's GlobalBay Mobile Point of Sale and GlobalBay Clienteling
These applications will further provide cloud-based payment
options to the consumers, so that they can make payments from
anywhere through their mobile devices. The alliance bodes well
for MasterCard as VeriFone enjoys a customer base, which includes
75% of the top 200 largest retailers in the U.S.
Similarly, mFoundry further strengthened its partnership with
MasterCard with the pact to connect MasterPass with its 900 bank
customers. mFoundry is a well-positioned mobile banking solutions
provider in the U.S. MasterCard also became aleading investor in
this firm in Dec 2011 to strengthen the combined mCommerce
Further expanding its digital payment services, MasterCard
collaborated with Orange and TIM, to boost mCommerce in Spain and
Brazil, respectively. The recent ease of sanctions in Myanmar
also amplifies MasterCard's growth opportunities in this richly
Over the past years, such alliances and business investments
have made MasterCard a global leader in digital payment services
through NFC and secure mobile applications. Moreover, the
combined market for payment from NFC-equipped mobile transactions
is expected to reach more than $74 billion globally by 2015 and
85% of terminals will accept cashless payments by 2016, according
to Juniper Research.
Hence, we believe that the collaborated initiative taken by
MasterCard and its allies is expected to be a valued advancement
in the rapidly growing mCommerce arena. Nevertheless, intense
competition in the industry of digital wallet services keeps our
optimistic outlook at bay for the time being.
MasterCard carries a Zacks Rank #3 (Hold). Other electronic
payment service providers who are performing well include
Total System Services Inc.
). All of these carry a Zacks Rank #2 (Buy).
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