MasterCard and Syniverse launch “not just another” mobile payment service
MasterCard has partnered with mobile technology specialist Syniverse under an audacious plan that aims at nothing less than “bringing mobile financial services to every single mobile user on the planet”.
The pair are currently piloting a fraud-prevention service that will link the customer’s card and mobile phone, so that when travelling abroad, a payment can only take place if both are present. The service is voluntary –customers can choose not to opt-in. The idea is to cut the frustration caused when card users travel abroad and find that their bank has blocked their card. It is also intended to reduce the risk of fraud, in which the user’s card is used abroad without their knowledge. However, the real scale of the partnership is much greater.
“This is not just ‘another’ mobile payment solution out to make a quick buck,” said Hany Fam, president of global strategic alliances at MasterCard. “There are 60 or so mobile payments projects out there, but none of them has succeeded in bringing any significant change. They all lack scale – they have limited geographic boundaries or only work with certain businesses. Our solution is global. We are planning to connect with every person on the planet.”
The scheme is planned for international launch in “early to mid” Q2. Participating banks will be able to offer it to customers, across both debit and credit cards. According to Fam, MasterCard is essentially taking the bundle of financial services that a user gets at home and giving access to it abroad.
“This has to be non-intrusive and add instant value to succeed,” he said. “It’s the first time the consumer can get their online loyalty program abroad. They can get their Oyster card downloaded onto their phone when they land in London, they can have their hotel booked. The 50-80% of card declined incidents caused by false positives are a major inconvenience to the consumer and we can help do away with it by bringing phone and card together.”
Mary Clark, chief marketing officer at Syniverse, added that every mobile phone is constantly updating the network with information on its location, even if data is switched off. The information consists of an ID number for the handset, which is not the same as the user’s (callable) mobile phone number. The value in the scheme is that it gives businesses the opportunity to see whether the card and the mobile device are in the same location. If not, the merchant gets the opportunity to decline. She also outlined future opportunities, including prepaid data.
“We want to do this once worldwide,” she said. “This is not about doing something in one country. When you build an aggregated service, the water rises for all boats. It’s better for everyone than having thousands of separate relationships.”
In future, MasterCard and Syniverse plan to market the collaboration as an opportunity for mobile operators and brands to implement targeted offers based on the location of a mobile device. The allies cited research by Syniverse which found that the market value for operators providing services to brands based on opted-in mobile subscriber information, behaviour and location could be as much as $44 billion.
Fam emphasised that users will have a choice about the information they choose to provide.
“MasterCard has no intention to exploit people’s personal data for commercial gain,” he said. “We do not keep any personal details – no addresses and no names. Instead we have a proxy – a card, or a mobile device, on the system by opt-in of the user. This is about fraud prevention. It’s about enabling users to curate their experience on mobile, using proxies, not their personal identity.”