Why the Secrecy?

  This month's cover story addresses the impact that MasterCard's change in ownership to a publicly traded corporation and Visa's plans to go a similar route are having on their relationships with merchants and issuers. It also addresses the relative openness the organizations will have to have in providing information to their stockholders.
  MasterCard Inc. has been forced to note some aspects of its operations that it might not otherwise have done as a private entity, such as its revised debit MasterCard deal with Visa's biggest issuer Bank of America. But it also has clouded some aspects of its reporting of data to the public. After years of releasing specific information about its debit MasterCard program, including transaction volume and funds spent with the cards, during last year's second quarter the card organization started including PIN-debit activity initiated with debit MasterCards.
  Visa says it doesn't report its check card data similarly, preferring to use pure signature-debit information in its quarterly reporting of transaction and sales volumes for its branded debit product.
  If I'm a MasterCard shareholder, or an issuer, wanting to know specific information about MasterCard's signature-debit program, I'd be a bit concerned. After all, MasterCard and Visa compete heavily for signature-debit market share, and MasterCard muddying up its numbers does not give a clear picture of where it stands in that market.
  Why should MasterCard include Star, NYCE or even its own Maestro PIN-debit transactions in its MasterCard Debit Program data? MasterCard says it does so because they were initiated with debit cards that carry the MasterCard logo. But that would be like Star reporting signature-debit data as its own on cards carrying both the MasterCard and Star brands.
  Even the fine print in MasterCard's earnings statement, where public firms like to hide sensitive information, is misleading. A footnote at the back of MasterCard's third-quarter financial report last November stated: "Debit transactions on Maestro and Cirrus-branded cards, Mondex transactions and other branded transactions are not included in the preceding tables." MasterCard changed the language a bit in its release of fourth-quarter data in February, stating: "Debit transactions on Maestro and Cirrus-branded cards, Mondex transactions and transactions involving brands other than MasterCard are not included in the preceding tables."
  That's strange, because they are. A MasterCard spokesperson confirmed to me that the card organization's quarterly data for MasterCard Debit "include both signature and PIN-authorized transactions."
  Why? There is no MasterCard PIN-debit brand.
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