Mastercard payouts gain momentum with new global partners and support for small businesses

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Mastercard has welcomed a series of new global partners to its innovative network Mastercard payments Illustrating the demand for powerful buy it now, pay later (BNPL) experiences from well-known and trusted brands, several new partners are supporting the program, HSBC, JP Morgan and NatWest United Kingdom; Cross the river, Evolving Banking and Trust, jifiti, Living Oak Bank, MOCA Financial and WebBank in the USA; and the Saudi National Bank (SNB) in Saudi Arabia. The program leverages the power and scale of the Mastercard network, which connects to more than 90 million merchants worldwide, to instantly support secure BNPL payments at checkout, in-store and online.


In addition to offering more payment choices, Mastercard installments are underpinned by responsible lending practices and supporting buyers with an enhanced set of consumer protections, data transparency, and knowledge-driven programs. Using technology, data and insights, along with consulting expertise, Mastercard is creating a smarter way to deliver installment loans at scale.


“We believe that no matter how you pay, a foundation of strong protections should be in place,” said Craig Vosburg, chief product officer at Mastercard. “Trust is the currency of innovation. Using a responsible approach by design ensures we stay ahead of the needs and expectations of consumers, merchants and banks, continuously building trust in the payments ecosystem by delivering choice at scale .


A responsible and smart way to offer installment loans


According to new global consumer research conducted by Mastercard’s World Payments Advisory™, nearly a quarter of respondents in more than 50 markets have used a BNPL product in the past six months.I For BNPL users, “forgetting payment was due” was the top reason for missing an installment payment, while concerns about “hidden fees” were cited as one of the top barriers to adoption by consumers as a whole. Mastercard Installments address these concerns with a suite of unique and innovative services that increase transparency and help protect consumers and businesses. These services include:

  • State-of-the-art insights and analytics: Merchants and lenders can access a comprehensive set of data dashboards to better understand the performance of their products. Mastercard Test & Learn® technology can also determine where to prioritize efforts and resources that improve user experience and promote loan repayment.
  • Repayment risk mitigation through open banking and artificial intelligence: In the United States, using consumer-authorized data and open banking technology, lenders can identify behavioral patterns to reduce the risk of payment failure, while artificial intelligence can adjust models faster and more accurately to achieve success.
  • Dedicated and built-in consumer protections: To participate in the Mastercard installment program, lenders agree to follow applicable laws and network guidelines on responsible lending practices and data use practices, among others. US consumers and small businesses enjoy the peace of mind they get today from any other Mastercard product – including tokenization, dispute resolution and zero fraud liability.

Empowering America’s Small Business


Mastercard research shows that more than 70% of small business owners who have used personal installments are likely to switch to business installments products if they become available.ii To meet this demand in the United States, Live Oak Bank, the nation’s leading small business lender, will support the program, with the aim of making Mastercard payouts available to its 7,000 small business customers.iii This builds on Mastercard’s ongoing commitment to Main Street America, providing products and services that help improve operational efficiency, manage cash flow and maximize customer relationships with financial tools.


Learn more about Mastercard payouts and its range of benefits for consumers, merchants and acquiring banks, lenders, and BNPL wallets and players.


Madhu Kejriwal, Group Head, Unsecured Lending & Partnerships, HSBC Wealth & Personal Banking, said: “Customer expectations have evolved as the payments landscape has evolved, so banks need to find appropriate solutions. Buy-Now-Pay-Later (BNPL) sits at the intersection of payments and lending; it can provide customers with a seamless payment option. However, it is important to realize that this is largely a form of credit. HSBC is fully committed to responsible lending, and transparency to clients is of the utmost importance to us. We want to clearly position any BNPL payment plan within a client’s approved line of credit. Our partnership with Mastercard is a crucial part of HSBC UK’s responsible lending strategy, as it enables us to provide customers with access to reliable payment options when they want to budget for larger purchases with affordable payment plans.


Huntley Garriott, Chairman of Live Oak Bank, said:Live Oak knows that small business customers need flexible financial products that offer security, transparency and scalability so they can grow their business at the pace that suits their needs. We’re excited to partner with Mastercard to explore lending solutions through Mastercard’s Installment Program, as it allows us to deliver innovative products from a trusted source while aligning with our mission to be the bank. American small business.


Martin Wise, managing director of short-term borrowing at NatWest, said: “There is a clear demand for buy now, pay later and we are committed to making it better and safer for our clients. Working closely with Mastercard, we ensure that responsible measures such as clear accessibility controls and helpful tools, such as payment reminders to help customers budget, are at the heart of our solution.


Majed Hamdan Al Ghamdi, Managing Director of Retail Bank at Saudi National Bank, said: Flexible payment options benefit everyone in the ecosystem, and our partnership with Mastercard allows us to connect people in Saudi Arabia to the seamless benefits of Mastercard payouts. Through this initiative, we are providing consumers with improved ways to pay when and where they want and according to their budget needs. Backed by the renowned security of the Mastercard network, Mastercard Installments unlocks new shopping experiences for consumers across the Kingdom while providing them with reassurance, confidence and peace of mind.


Sources:

  1. Mastercard World Payments Notice. “The Explosive Growth of the ‘Buy Now, Pay Later’ Report. Quarterly online survey of 53,500 adults in over 50 countries. Conducted April 30-June 14, 2022.
  2. Mastercard & Kaiser Associates, Small Business Payout Analysis, 2021
  3. Note from source: #1 SBA 7(a) lender by dollar amount for fiscal year 2021. Data provided by the SBA reflects the highest 7(a) dollar volume in fiscal year 2021.

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About Mastercard (NYSE: MA)


Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. Our decency quotient, or DQ, drives our culture and everything we do inside and outside our company. With connections in more than 210 countries and territories, we are building a sustainable world that unlocks invaluable opportunity for all.


www.mastercard.com

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