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Mastercard (MA) Adds Partners to Strengthen BNPL Program

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Mastercard Incorporated MA recently extended its Buy Now Pay Later ("BNPL") program, Mastercard Installments, in an effort to involve more partners to facilitate enhanced and flexible installment options to consumers. The service was initially launched by Mastercard in September 2021 across the United States, Australia and the U.K.

Following the recent expansion, American Airlines, CSI, Fiserv and Total System Services (“TSYS”) will join the other leading partners under the BNPL program in the United States. Meanwhile, BNPL players hummgroup and Limepay will join forces with Mastercard in Australia to revolutionize payments and the BNPL ecosystem.

Mastercard has been focused on deepening its presence through Mastercard Installments in the BNPL market, which has been gaining prominence owing to the numerous benefits offered.

The BNPL market is well-positioned for solid growth, backed by growing inclination of people toward digital means — a trend triggered by the COVID-19 pandemic. Per Research and Markets, the worldwide BNPL market is anticipated to witness a CAGR of 22.4% over the 2021-2028 period. The same market is likely to attain $3.98 trillion by 2030, while it was valued at $90.69 billion in 2020, per Allied Market Research.

Apart from Mastercard, companies like American Express AXP, Visa V and Global Payments GPN seem well-poised to capitalize on opportunities offered by the growing BNPL market.

American Express has already been an active player in the BNPL space. AXP intends to extend BNPL offerings beyond the retail consumer space and integrate these services within the travel space this year. Visa’s installment solution was first launched as a pilot in 2019. Gradually, the solution expanded to the United States, Canada, Malaysia and Russia. It has been launched in Australia this year. Global Payments’ company TSYS partnered with Mastercard last year to help issuers and merchants in North America provide flexible payment options through which customers holding Mastercard cards can divide the payment for their purchases into parts or installments.

The Mastercard Installment comes at an opportune time and will aid the company in strengthening its presence in the BNPL market. The COVID-19 pandemic has induced severe financial uncertainties worldwide, which has strained the purchasing power of consumers. As consumers are able to make installments at checkout, this innovative payment solution positively influences buying behavior of consumers while purchasing expensive or general items, and enables them to properly manage their finance as well as expenses.

Mastercard Installments are of immense importance to merchants as well, considering timely payments by customers, increased average transaction value, enhanced customer base, and several other benefits stemming from the product.

Apart from extending BNPL services, this Zacks Rank #3 (Hold) payment processor has been collaborating with several local and global well-established organizations, for upgrading its overall capabilities and facilitating enhanced management of global payments.

Shares of Mastercard have gained 9% in a year against the industry’s decline of 15.1%.

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While shares of American Express and Visa have gained 63.3% and 3.5%, respectively, in a year, shares of Global Payments have lost 28.1% in the same time frame.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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Mastercard Incorporated (MA) : Free Stock Analysis Report

Visa Inc. (V) : Free Stock Analysis Report

American Express Company (AXP) : Free Stock Analysis Report

Global Payments Inc. (GPN) : Free Stock Analysis Report

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