dcsimg

MasterCard planning two-pronged attack on PayPal, with digital wallet and transaction fees due this year

By , CardRatings contributor
  • Google +
  • Twitter
  • Facebook

MasterCard and Visa stepped up their rivalry with PayPal this month, with expansions of their own digital wallet initiatives and the threat of raising fees for third-party merchant processors. According to published news reports, the moves come as PayPal has ventured into point-of-sale transactions at physical checkout counters while offering customers lines of credit through its BillMeLater subsidiary.

eBay, PayPal's parent company, saw its stock value decline by over 10 percent after a February regulatory filing warning shareholders of potential fallout from future processing surcharges. In an investor note, analysts Bill Carcache and Brian Nowak of Nomura Equity Research advised clients that MasterCard's planned June rollout of new digital wallet surcharges would ensure proper compensation for use of the payment network.

MasterCard powering loyalty programs with its own digital wallet

In an interview with financial trade publication PYMNTS.com, MasterCard spokesman Nandan Mer said that his company focuses on loyalty among consumers, merchants, and card issuers. Mer outlined plans that would enable MasterCard to track merchants' and banks' own customer loyalty programs more effectively, without the need to engage third-party processing platforms.

The payment platform aims to accomplish some of these goals by rolling out MasterPass, a proprietary digital wallet service that works both online and in physical retail stores. Canadians get a first look at the service when it launches there this spring, followed by a rollout in Australia before its United States release. MasterCard officials have told reporters and analysts that the program supports "omnichannel sales experiences" that combine online transactions with real-world interactions.

Visa's V.me has already launched in the United States, but on a bank-by-bank basis through partners such as PNC Bank, U.S. Bank, and Pentagon Federal Credit Union. Like Google Wallet and PayPal, Visa's digital wallet solution stores credit card details on a secure server and passes a token to online merchants instead of a raw account number.

0 Responses to "MasterCard planning two-pronged attack on PayPal, with digital wallet and transaction fees due this year"

No Comments

Leave a Comment
 
 
 
About Our Ratings ×

Our editors rate credit cards objectively based on the features the credit card offers consumers, the fees and interest rates, and how a credit card compares with other cards in its category. Ratings vary by category, and the same card may receive a certain number of stars in one category and a higher or lower number in another.

The ratings are the expert opinion of our editors, and not influenced by any remuneration this site may receive from card issuers.

Advertisers in our database are highlighted, and advertisements include an option to apply using links on our site. CardRatings.com may be compensated by companies mentioned on the site when a user's application is accepted or approved by such companies.

How do your cards stack up?

Compare your card starting here

NEXT »

Featured Partner Cards

loading