MasterCard: Contactless payments key trend in SEE
What payment solutions does MasterCard offer for the different client segments?
We offer payment solutions that provide issuers, merchants and corporations with better choices and channels to grow their businesses. For more than 40 years, MasterCard has been advancing the way consumer and business cardholders around the world shop, dine, travel and manage their money, enabling transactions that drive global commerce and improve peoples' lives.
Our wide variety of customized payment card types include credit, debit, prepaid, commercial, chip and contactless, all of which feature state-of-the-art security and convenience. With innovative loyalty and reward solutions and comprehensive cardholder benefits and services, our card products provide financial institutions, merchants, and businesses with inventive ways to decrease costs and increase customer satisfaction.
Each market has different needs. For that matter, we regularly run research programs on the markets in which we operate to get insight into cardholders' needs, habits, attitudes, as well as perception of their own financial situation. At the same time, the feedback we receive from our partners in terms of the market demands and their specific client group needs is invaluable for offering them suitable products that best cater to their customers' needs.
How are innovative payment solutions changing the card industry and how is MasterCard positioned to pace these trends?
Payment card industry is shaped by changing consumer needs and lifestyle, and innovative payment solutions are designed to cater to those needs, and improve commercial activities.
As a leading technology company in the financial services industry, we are passionate about innovation and we are constantly seeking to develop and test new payment solutions that make everyday commerce activities easier, more secure and more efficient for everyone.
MasterCard was recently listed in the Forbes Most Innovative Companies list. At number 32, our company sits alongside the world's top 100 innovative companies based on a methodology that reflects firms which are innovative now, and are expect to be so in the future. All of these global brands are working daily to evolve their business and continue to do new and exciting things in their respective fields.
What are the latest trends in the card payment industry?
The most prominent trend in the payment industry is making payments available anywhere, anytime. Consumers worldwide appreciate convenient and safe products that also save their time, and as their lives are becoming increasingly digital, they readily embrace contactless payments via cards, mobile phones or any other gadget that they have with them all the time.
With all of that in mind, we launched our digital payment platform called MasterPass to enable consumers to make payments which are protected by multi-layer security with just a click, tap or touch wherever they are – in-store or online. MasterPass is an open-wallet platform, which means that users are able to store cards from all card brands, as well as ID, health and loyalty cards and shipping information, all of which data is constantly available to them. With this digital payments solution, the checkout process is a safe and simple experience, customized to end users' needs.
How are the latest market trends affecting card payment patterns in SEE?
Contactless is one of the most prominent payment trends in Central and Eastern Europe (CEE), particularly in the Balkans.
MasterCard contactless technology, better known as PayPass, is already present on most of these markets. A single tap of a contactless card against a special reader at a Point of Sale (POS) terminal is all it takes to make a payment. In addition to being fast and convenient to use, it is safe, as it is based on the chip technology. Additionally, the card never leaves the cardholder's hands during the payment, providing a greater sense of control and security.
When in mass usage, which is our ultimate goal when it comes to this type of a product, merchants begin to note a huge difference, as contactless transactions speed up the payment process and help merchants prevent long lines and serve more customers, who at the same time enjoy fast, convenient and safe shopping.
Contactless products are multi-purpose and can come with bonus features based on the preferences of the issuing institution. The contactless payment infrastructure sets an excellent foundation for related technologies, such as mobile payments.
We are aware that acquiring new technologies is a step-by-step process and that wide implementation of contactless, mobile and online payments needs to precede the implementation of solutions such as MasterPass, as only then both merchants and consumers would be able to get the most out of the benefits this service offers. We are steadily moving in that direction.
What is the pace of penetration of contactless payments in SEE? What can be done to speed up the process?
We are very pleased with the gradual developments of our contactless payments in the Balkans and the way consumers embrace the solutions we offer. Out of six Balkan markets almost all have implemented MasterCard Contactless payment technology – Bulgaria, Macedonia, Montenegro, Serbia, and most recently, Bosnia and Herzegovina, as well as some other CEE countries, including Croatia,
Hungary and Romania, to name a few.
We are working on establishing MasterCard contactless acceptance as standard by 2020 for merchants accepting MasterCard and Maestro in Europe, ensuring that, consumers will be able to pay with their contactless cards and NFC enabled devices at all POS terminals in Europe by 2020.
In view of the high level of readiness of the Bulgarian and Serbian markets, we have set shorter compliance dates for the countries – starting with July 1, 2015 all newly-introduced POS terminals in Bulgaria and Serbia will have to adhere to the new standard, and starting with July 1, 2018, it will be necessary for all existing POS terminals to support the contactless functionality.
This is a stimulus for us to continue working on enabling cardholders to pay with our innovative method, whenever and wherever they like.
Also, it is important to highlight that understanding the technology and the benefits it offers to the key participants in the payment process is what determines the speed of the implementation. For this very reason, we have been working closely with our partners in the banking and retail sector, to help educate cardholders about the advantages contactless payments offer.
What are the implications for the industry from the latest EU regulations on interbank transactions?
The negative ruling by the European Court of Justice in relation to cross border interchange fees is disappointing. When MasterCard brought this action in 2007 we did so because we believed then, as we do now, that market-based solutions are the best way to ensure a fair and competitive payments landscape in Europe – one that makes consumers' lives easier, and brings increased business for merchants. The negative judgment will have little or no impact on how MasterCard operates; we will continue to comply with the decision as we have been doing for a number of years. This means we would maintain our European (intra-EAA) cross-border consumer interchange fees at a weighted average of 0.2% for debit and 0.3% for credit. Together with our partners, we are committed to constructive cooperation and dialogue with EU decision-makers to ensure that any future payments legislation allows us to provide the most innovative and affordable payment solutions to our customers, cardholders and retailers, and does not have the unintended consequence of shifting costs on to consumers.
The most prominent trend in the payment industry is making payments available anywhere, anytime.
MasterCard operates the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone.