Mastercard's Big Plan for Asia Focuses on Finer Details

Mastercard has several longer-term initiatives underway in China and other parts of Asia, an effort that's become increasingly focused on customized services.

The card network will host processing services, along with access to fraud prevention and technology tools enabling clients to tailor products, features, fees and authentication rules in real time.

"Digital disruption is ever-increasing and the payments industry is no exception," said Rama Sridhar, senior vice president of network processing and security solutions for Asia Pacific for Mastercard in Singapore. "Digitally-savvy consumers seek faster, simpler and more seamless experiences, not just when making payments but in everyday life."

The Purchase, N.Y.-based card network's services are designed to make it easier for local companies to embed payments with ancillary digital and brick and mortar services, and mirrors moves by the card networks in other regions to become more open in their approach to technology.

Visa, for example, recently opened its technology toolkit to external developers to support payments innovation and accelerate its development. Mastercard has opened two development centers in India over the past couple of years.  

Mastercard's new offering is not a developer sandbox, but an integrated suite that issuers and acquirers can access to help build a payments chain, Sridhar said, adding the fee is based on the services used.

"With payments industry becoming increasingly competitive, the differentiator can no longer simply be the product itself, but in the value added services that complement the product," Sridhar said, adding the network plans to look at services beyond payment processing.

The range of services has also become necessary given the breadth of initiatives in the region. Mastercard's wish to establish a market in China is well documented, but the card brand also has initiatives in other countries such as Myanmar.

More recently the network collaborated with Western Union, bKash and BRAC Bank to launch a mobile money service in Bangladesh, and is working with startups through the Start Path Global in Asia Pacific. The network also recently put out a call for startups in China and Hong Kong.

The initiatives are part of a broader diversification initiative at Mastercard, one that relies on partnerships and as such an easily deployed set of tech tools, according to Sridhar. Other companies are also relying on partnerships to gain a foothold in China, including Canadian mobile payment company Mobeewave, which is collaborating with the Alliance Development Group, which guides foreign companies through the Chinese marketplace.

"Banks, governments and businesses are therefore under ever-increasing pressure to provide a global, seamless and secure platform to make this virtual world of payments a reality," Sridhar said. "One of the ways we do this is through partnering with various players in the ecosystem."

The Chinese e-commerce market also requires a robust full set of services and technology, according to Dan Buckstaff, vice president of marketing at Jetlore, a personalized digital marketing company..

Platforms like Tmall and JD are ubiquitous in China and dominate market share. As a result, almost all Chinese consumers use their apps frequently, Buckstaff said.

"These companies offer a more centralized experience within their mobile application so consumers can stay within the app throughout their journey from shopping to payment. And in China, consumers trust these payment systems more than others and it makes these apps stickier," Buckstaff said. "Additionally, these platforms are more retail focused, so they have the ability to devote resources to creating this all inclusive experience within their platform."