MasterCard Signs Point of Sale Marketing Pact with Hypercom

MasterCard International said it has signed a global agreement with Hypercom Inc. that will give its members discounts on point of sale terminal purchases.

The deal follows one inked in August with Verifone Inc., the largest manufacturer of point of sale terminals in the United States.

The objective is to increase the acceptance of MasterCard products worldwide, said Heidi Goff, senior vice president, global point of interaction.

"We're looking for partners to help us expand the number of merchants that accept our brands," said Ms. Goff. "There will be a sea change in how acceptance is done in future," she said, referring to the onset of chip cards, electronic commerce, and methods of cardholder verification like biometrics.

The program is expected to drive terminal deployment by providing members with preferred pricing and volume discounts.

"Members can take the savings to buy more terminals," said Ms. Goff, "and get them out into the market faster at more locations."

She said the deal would save millions of dollars and add 40,000 terminals in the United States alone.

Hypercom sells more than 300,000 terminals annually in the United States, while Verifone sold 525,000 in the United States and Canada in 1995.

Ms. Goff said MasterCard's Maestro debit product is rapidly expanding in Latin America, creating a need for keypads and terminals at new locations. Hypercom is the leading terminal deployer in Latin America and the Asia- Pacific region.

Though MasterCard calls the agreement an alliance that encompasses education, training, and research and development, industry consultant Paul Martaus, based in Clearwater Fla., said it is a marketing agreement.

He said he "applauds the effort," but is "lukewarm" on these types of arrangements. He questioned MasterCard's need for alliances with terminal manufacturers.

Albert Irato, president and chief executive of Hypercom, called the agreement an "excellent benefit for members that will stimulate the banks to purchase more terminals and have the comfort of knowing a vendor like Hypercom is approved by MasterCard."

MasterCard and Hypercom said the deal is nonexclusive and both are considering agreements with other partners.

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