NationsBank Corp., one of the nation's largest processors of card transactions for retail merchants, has agreed to use MasterCard as its primary provider of merchant point of sale products and services.

The deal will make MasterCard's Automated Point of Sale Program, known as MAPP, the processor of a majority of debit and credit transactions from merchants that NationsBank will sign in the coming years.

NationsBank will also collaborate with the New York-based card association on new products and technologies for merchants.

Neither NationsBank nor MasterCard would be more specific about the terms of their agreement. NationsBank claims to be the fourth-largest merchant processor in the country. A Credit Card News ranking based on 1992 transaction volume placed NationsBank fifth, behind the three top nonbank processors and BankAmerica Corp.

Host-Based System

The Charlotte, N.C.-based superregional chose MAPP over the several other vendors with which it processes in part because MasterCard's merchant system relies on a host-based, rather than terminal-based, computer system.

The advantage of such a setup is that merchant-service changes can be accomplished through alterations to the host computer system, rather than to thousands of individual merchant systems, NationsBank desired.

"Crisis in our world comes when a merchant cannot convert that plastic to cash, and so a system that runs to us at a host level provides more comfort for our customers," said O.B. Rawls 4th, senior vice president at NationsBank.

Lower Pricing

Mr. Rawls said the MasterCard connection will help NationsBank lower its pricing to retail merchants.

"A lot of our business is a commodity now, and you only differentiate a commodity on price and on the value the customer perceives," said Mr. Rawls. "It's a scale business, and concentration of volume into one place helps provide scale."

MasterCard said it will meet with NationsBank next month to discuss the training and newproduct needs of NationsBank merchant customers.

"We don't talk directly to the merchants," said Sharon Cline, vice president of marketing at MasterCard.

"We sell through the banking networks," she said. "So we're looking to NationsBank to give us a look at that next level down so that we build better products and do better training."

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