Mastercard Incorporated ( MA Quick Quote MA - Free Report) recently announced that it is partnering with the growing financial technology (FinTech) company OPay to introduce its digital commerce in the Middle East and Africa. This partnership is in line with MA’s goal of bringing one billion people under the ambit of the digital economy by 2025.
The partnership will allow Mastercard to cater to a huge customer and merchant base across a belt that includes countries like Algeria, Egypt, Ethiopia, Kenya, Morocco, Nigeria, Pakistan, South Africa and the United Arab Emirates. Clients can access businesses worldwide with the Mastercard virtual payment solution, which is linked to the eWallet of OPay.
The initial stage of the tie-up will enable clients to use the OPay wallets to shop from global brands, even if they do not possess a bank account. This move will likely bring more people under digital economy. Also, small merchants will be able to access international suppliers using this payment solution.
OPay started its journey in 2018 and currently has 15 million active users. The company caters to more than $6 billion monthly transactions. It has a significant market share in Nigeria and plans to further enhance its footprint in other geographies over the next three to five years. The alliance will bring incremental transaction volume to Mastercard’s portfolio over the coming days. It will enable MA to scale up its digital inclusion strategy.
The move will expand Mastercard’s presence in the in the Middle East and Africa regions. Partnerships like this will ramp up demand for MA’s services. While businesses are recovering in the said zone, demand for global and digital payment solutions is expected to keep rising.
Against this backdrop, Mastercard’s decision to boost its presence and bring more customers within the scope of digital economy can prove fruitful. It will increase MA’s revenue sources. The digital economy target is set for 2025, including 50 million small and micro businesses.
The currently Zacks Rank #3 (Hold) player has made similar moves in the past few months to enhance its presence in the growing economies. Mastercard partnered with FinTech startup Jeeves to launch a physical card in Mexico. MA
joined forces with Trinidad & Tobago International Financial Centre to provide digital solutions, which will ramp up digital growth across the country. Also, MA expanded its footprint in Somalia through collaborations with MyBank and Network International.
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Shares of Mastercard have gained 4.5% in the past six months against the
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