Mastercard Incorporated MA recently entered into a multi-year commercial partnership with Amazon Payment Services to enhance digital payment acceptance across the Middle East and Africa (MEA). Per the deal, MA will provide its Mastercard Gateway solution, a single touchpoint for payment processing. It is available in 40 markets across the region.
It will enable fast, seamless and secure transactions in the said markets. The partnership aims to benefit Amazon Payment Services’ merchants and expand their reach, while also co-developing innovative payment solutions like Secure Card on File, Click to Pay and token authentication services.
Countries expected to benefit from this deal include South Africa, UAE, Bahrain, Egypt, Lebanon, Oman, Jordan, Kuwait and Qatar. By partnering with Amazon Payment Services, Mastercard can significantly expand its presence across the MEA, covering some key growing markets. The deal will increase the adoption of its payment processing technology.
How Will MA Benefit?
The integration will likely attract a broader base of merchants, including Amazon’s online stores, while also opening up new synergies with other sectors such as telecom and government entities. With the growing demand for digital payment solutions, partnering with a major player like Amazon Payment Services strengthens Mastercard’s reputation as an innovative and reliable payment provider in emerging markets.
More merchants using Mastercard’s technology translates to higher transaction volumes, which can drive revenue growth through fees and service offerings. The Mastercard Payment Industry Insights Index revealed that 95% of consumers in the MEA are open to using new payment options like QR codes, wearables, digital wallets, biometrics and contactless payments.
Moreover, a majority (61%) would avoid shops that don’t accept electronic payments. It also mentions that banks that switched to digital services have seen digital transactions grow significantly, jumping from 70% to 90% in just about two years. This trend shows a strong shift towards digital payments in the region. As such, the new deal can be a game-changer for both consumers and merchants in the MEA region, as well as Mastercard, who’ll benefit from the growth in digitization.
This partnership will also enable Amazon Payment Services to scale faster, offer superior technology, and create a more robust and comprehensive payment ecosystem in the region.
MA's Price Performance
Shares of Mastercard have gained 23.5% in the past year compared with the industry’s 22.1% growth.
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Zacks Rank & Key Picks
Mastercard currently carries a Zacks Rank #3 (Hold).
Investors can also look at some better-ranked stocks from the broader Business Services space, like Fidelity National Information Services, Inc. FIS, Cantaloupe, Inc. CTLP and Paysign, Inc. PAYS.While Fidelity National currently sports a Zacks Rank #1 (Strong Buy), Cantaloupe and Paysign each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Fidelity National’s current-year earnings indicates a 50.7% year-over-year increase. FIS beat earnings estimates in two of the trailing four quarters and missed twice. The consensus estimate for current-year revenues is pegged at $10.2 billion.
The Zacks Consensus Estimate for Cantaloupe’s current-year earnings indicates a 106.7% year-over-year surge. CTLP beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 45%. The consensus estimate for current-year revenues implies 16.1% year-over-year growth.
The consensus estimate for Paysign’s current-year earnings indicates 75% year-over-year growth. The consensus estimate for PAYS’ current-year revenues is pegged at $58 million, implying 22.6% year-over-year growth.
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