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MasterCard Worldwide, whose efforts to capture debit card market share from Visa Inc. have suffered a series of recent setbacks, is hoping to win over issuers with rewards that will be widely available and financed by merchants. The company today said it is unveiling MasterCard Savings, which enables all U.S. debit and some prepaid cardholders to earn such rewards as coupons, discounts and statement credits, regardless of the card's issuer. The rewards are meant to supplement, not replace, issuers' debit rewards, MasterCard says. "This is a program that is no cost to the issuers," Patricia Preston, MasterCard senior vice president for U.S. debit product management and development, said Friday. "It will drive increased volume and usage on their cards. It will also be a powerful retention tool. … It provides what we feel is a very compelling reason for an issuer to want to issue a debit MasterCard." Observers say the program's scale is unprecedented in debit. Jonathan Gagliano, executive vice president of Affinity Solutions Inc., which designs merchant-funded rewards, was not aware of another program that would be available to all debit cardholders and is free for issuers. "I don't think that exists today," he says. "If you're looking at Visa and MasterCard, does this give MasterCard an edge? Absolutely." Next Jump Inc. helped develop the MasterCard program and recruited more than 25,000 merchants to offer coupons, discounts, free shipping, or automatic statement credit to cardholders.
