MasterCard is strengthening its ties with mobile network operators with a new suite of services that are intended to help those companies better assist subscribers and small businesses connect to digital payment experiences.
The Purchase, New York-based card network has already helped MNOs such as Vodafone Ukraine, Digicel Group in the Caribbean, Viettel Telecom in Vietnam and Taiwan's Chunghwa Telecom to roll out various services related to these new offerings such as Masterpass integration, direct carrier billing and QR code-based payments as well as data insights for small business to help them identify new opportunities.
Mobile operators over the years have traditionally dealt with direct carrier billing companies for similar services, but such efforts mostly address digital content. MasterCard believes it is in a better position to help MNOs to bridge the gap between digital and physical goods for both subscribers and small businesses.
That is an issue direct carrier billers have worked on for the past few years, but with varying degrees of success.
"We've been working with MNOs for years," Kiki Del Valle, senior vice president of commerce for every device at MasterCard, told Mobile Payments Today in an interview ahead of the official announcement. "The difference with what we have now is that MNOs are going through this transformation and it's allowing for new opportunities to rely on more traditional forms of payments and moving beyond just having a prepaid companion card associated with a mobile money account.
"If you think about it, that was the traditional extent of the relationship. What we're finding now is a lot more willingness and openness [from the MNOs] to work with MasterCard to be creative around solutions and to identify ways we can innovate."
One unique way MasterCard is helping MNOs innovate is a program in East Africa that enables mobile subscribers to pay for electricity via solar panels using the card network's QR code technology.
MasterCard is working with M-Kopa, a company that provides clean energy to some 3 million citizens in East Africa.
M-Kopa's customers can purchase a solar home system on credit and then make small daily payments using mobile money stored in their accounts for the amount of electricity they need for the day. Those customers complete the payment either scanning a QR code from their smartphone or entering the merchant ID associated with the QR code into their feature phone.
In turn, those solar energy users can then charge their neighbors access to electricity they might need and settle payment through mobile money accounts.
"It brings it back to the power of the IoT and connected things and also the role the MNOs are playing," Del Valle said about the solar energy initiative. "Ultimately, it's the MNOs that are holding the mobile money so that the consumer is topping up and now using it not only for data services, but to also pay for energy."
Such an initiative also plays into the drive to include more people into financial services.
Companies and governments in African and Latin American nations as well as in countries such as India have long sought to help more citizens find their way into a digital payment ecosystem that continues to grow year by year.
"The other aspect [to the solar energy partnership] is to actually help drive additional use cases for that specific [financially] underserved person that we're trying so hard to get into the digital space with such services," Del Valle said.
One of the more eye-popping examples of this is MasterCard's partnership with Military Bank in Vietnam that enables Viettel Telecom to offer its more than 3 million customers access to physical and prepaid cards. Some 700,000 of those customers have requested the companion card to do things such as P2P transfers and to pay for utility bills and airline tickets.
Will Hernandez Will Hernandez has 14 years of experience ranging from newspapers to wire services and trade publications. Before becoming Editor of MobilePaymentsToday.com, he spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator and information hub published by Mercator Advisory Group. Will spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia's Payments Group based in Chicago.