Mastercard (MA) Unveils Offering, Expands in Open Banking Space

Mastercard Incorporated MA recently introduced an innovative payments feature called Pay by link powered by Aiia, which is an acquisition of MA and a leading European open banking technology provider. The feature is already available across the Nordics and is projected to reach entire Europe right through 2022.

Built on open payments, the feature enables customers to conduct immediate and secured bill payments by utilizing a simple link. For availing of this feature, customers simply require a bank account, and there’s no need to memorize the payment details. Consequently, businesses can seamlessly accept and receive payments worldwide. Companies in diversified space comprising accounting, insurance, telecom, utility and social commerce will be empowered to eliminate the unneeded steps for consumers while making payments and thereby minimize friction within the payment flow.

The decision to expand the reach of the “Pay by link” feature into Europe seems to be a time opportune one. The reason can be attributed to the success already achieved in simplifying invoice payments and easy reconciliation of invoices by Nordic’s well-established accounting software provider, Dinero, through the usage of the innovative payments offering.

Initiatives similar to the latest one reinforce Mastercard’s continuous efforts to encourage more businesses to seamlessly embrace open banking payments, owing to the numerous benefits offered by it in the form of a varied set of choices, enhanced services and seamless outcomes. Apart from the buyout of Aiia, Mastercard acquired Finicity in 2020, which connects users' bank accounts with other payment apps. This move provided a further boost to the company in the open banking space.

Mastercard is focused on strengthening its position in the open banking space, owing to the immense growth scope of the market and the growing inclination of worldwide consumers toward pursuing open banking payments. The global open banking market is anticipated to witness a CAGR of nearly 24% over the 2022-2028 period, per Vantage Market Research. Some of the reasons behind such impressive growth, as cited by the market research services provider, are the higher adoption of open banking solutions across multiple industries and the increasing emergence of digital payments and mobile wallets.

Mastercard boasts of a diversified digital payment offering suite, which it has developed through collaborations with industry leaders or significant investments with regard to the product portfolio.

Shares of Mastercard have gained 5.7% in the past six months against the industry’s decline of 9.5%. MA currently carries a Zacks Rank #3 (Hold).

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Stocks to Consider

Some better-ranked stocks in the Business Services space include Huron Consulting Group Inc. HURN, Automatic Data Processing, Inc. ADP and Green Dot Corporation GDOT. While Huron Consulting currently flaunts a Zacks Rank #1 (Strong Buy), Automatic Data Processing and Green Dot carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The bottom line of Huron Consulting outpaced estimates in each of the last four quarters, the average surprise being 29.97%. The Zacks Consensus Estimate for HURN’s 2022 earnings suggests an improvement of 22.6% from the year-ago reported figure. The same for revenues suggests year-over-year growth of 13.5%. The consensus mark for Huron Consulting’s 2022 earnings has moved 5.3% north in the past 30 days.

Automatic Data Processing’s earnings outpaced estimates in each of the trailing four quarters and missed once, the average surprise being 6.23%. The Zacks Consensus Estimate for ADP’s 2022 earnings suggests an improvement of 15.8% from the year-ago reported figure. The same for revenues suggests growth of 9.5%. The consensus mark for Automatic Data Processing’s 2022 earnings has moved 2.2% north in the past 60 days.

The bottom line of Green Dot outpaced estimates in three of the last four quarters and missed once, the average surprise being 20.50%. The Zacks Consensus Estimate for GDOT’s 2022 earnings suggests an improvement of 8.6% from the year-ago reported figure. The same for revenues suggests growth of 2.3% from a year ago. The consensus mark for Green Dot’s 2022 earnings has moved 1.7% north in the past 30 days.

Huron Consulting stock has gained 29.1% in the past six months. Meanwhile, shares of Automatic Data Processing and Green Dot have lost 5.5% and 21%, respectively, in the same time frame.

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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 Nasdaq, Inc.

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