Mastercard Inc. ( MA Quick Quote MA - Free Report) along with partners Total System Services and Extend have introduced a mobile virtual card solution for commercial clients. These commercial cards will be used for digital, contactless payments. Total System will generate the virtual card number, which will then be accessed on the Extend app and seamlessly get loaded into a mobile wallet.
These payment modes gained prominence amid the coronavirus pandemic, which accelerated the adoption of digital and contactless payments, upping the appeal for digital cards.
These virtual corporate cards can be easily loaded into a mobile wallet, such as Apple Pay or Samsung Pay for fast and secure touchless payments. Earlier, these cards could not be smoothly loaded into mobile wallets, thus posing as a key hindrance to its wider uptake.
The new solution allows employees or contractors to load their virtual corporate card into their mobile wallet effortlessly for initiating contactless payments with their mobile device. With this service, the virtual cards will become relevant for in-store purchases and fully penetrate the payments market.
The mobile virtual card solution for commercial use is based on Mastercard’s Digital Enablement Services (MDES), which tokenizes virtual cards. Via this technology, cardholders’ sensitive information, such as account numbers and expiration dates are replaced with a unique digital identifier (a token), which can be used for payment, safeguarding their confidential details in the process. Tokenization hides consumers’ personal account data during digital transactions, making digital remittances more secure for everyone, everywhere.
Businesses looking for flexible, virtual payment solutions can use this service to issue a single or multi-use virtual card to employees, enabling them to fund and manage authorized purchases.
Mastercard plans to tap the virtual card market, which is poised for strong growth. Per a Juniper Research report, the virtual card usage will more than triple to $5 trillion plus in transaction value by 2025 as the centralized digital payment method branches out into other use cases beyond corporate travel.
The promising virtual credit card market gained attention of other players too. In July,
JPMorgan Chase & Co. ( JPM Quick Quote JPM - Free Report) partnered fintech start-up Marqeta to launch virtual credit cards. Another company Square, Inc. ( SQ Quick Quote SQ - Free Report) also uses Marqeta for a virtual and physical debit card unveiled through Square Cash.
Visa Inc. ( V Quick Quote V - Free Report) along with Conferma Pay introduced virtual commercial cards called Visa Commercial Pay. The stock has gained 13.3% in six months’ time compared with the industry’s growth of 8.1%.
Mastercard carries a Zacks Rank #4 (Sell), currently.
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