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Mastercard (MA) Ties Up to Launch Card in India, Aid Commuters

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Mastercard Incorporated (MA - Free Report) recently collaborated with Mumbai Metro and India’s third largest private sector bank — Axis Bank, in a bid to introduce the prepaid and open loop contactless “One Mumbai Metro Card.”

Shares of Mastercard gained 0.7% on Jul 9.

The card can be utilized by Mumbai’s daily commuters with a single tap and easy recharges. The card can be put to use for diverse purposes ranging from booking one’s daily tickets to conducting everyday expenditures encompassing grocery, medicines and shopping.

This, in turn, is expected to offer upgraded tap and go transit payment solutions and digitize commuters’ transit journey across Mumbai. The card intends to eliminate the cardholders’ need to stand in queues and instead promotes contactless payment. These payments have gained widespread prominence amid the COVID-19 pandemic as it reduces the chance of infection.

The recent move is in sync with Mastercard’s efforts to technologically upgrade India’s transit system amid gradual reopening of the global transportation system. To bring the idea to fruition, the company banks on its global expertise across Singapore, Sydney and London, and launch seamless transit solutions and promote widespread usage of open loop payments amid public transport. Such efforts are expected to bolster Mastercard’s capabilities and strengthen its foothold across India.

The card comes at an opportune time considering the ongoing trend of most travel companies embracing technological advancements and offering contactless commuting experiences.  Backed with enhanced safety standards of Mastercard, the card aims to complement several initiatives undertaken by the Indian Government to digitize the nation’s transport journey.

Time and again, Mastercard has worked closely with transit agencies and empowered them to innovate and devise customized prepaid digital payment solutions. The company has Mastercard Transit Partner Program in place through which the company has been collaborating with transit operators, service providers and technology partners for launching innovative transit solutions worldwide.

In June 2021, Mastercard joined forces with LATAM Airlines Group for introducing innovative digital solutions and enhance the travel experience of commuters. Earlier, the company partnered with Transport for New South Wales ("NSW") and Department of Transport and Main Road ("TMR") Queensland for rolling out advanced payment technologies for their respective transport users.

Other companies in the same space have also taken steps to simplify the transit experience. This year, Visa (V - Free Report) partnered with Monterey-Salinas Transit (“MST”) to launch contactless payment option and offer equitable fare payment system to California residents. Global Payments (GPN - Free Report) has been utilizing its core processing platform to bring out enhanced payment technologies for customers availing public transport. EVO Payments joined forces with On Track Innovations for providing end-to-end payment solutions with an aim to augment the transit experience.

Zacks Rank & Price Performance

Shares of Mastercard have gained 28.5% in a year compared with the industry’s growth of 8.4%.

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Mastercard has a Zacks Rank #4 (Sell).

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