Mastercard (MA) Extends Installment Program in Philippines
Mastercard Incorporated MA recently collaborated with the renowned merchant commerce platform of Asia Pine Labs in a bid to introduce the program “Mastercard Installments with Pine Labs” throughout the Philippines.
The program was initially launched in March 2022 through collective efforts from Mastercard, DBS Bank and Pine Labs, with the intent to extend its reach across select Asian cities within the second quarter of this year. The country (Philippines) in which the installment program has been recently launched marks the first Southeast Asian market amid those five that have plans to offer the program across their countries.
Presently, Mastercard Installments with Pine Labs can be availed by consumers in the Philippines across more than 20 merchant locations. Currently accessible at local in-store merchants, the program will benefit the country’s cardholders in the future and widen its scope to add online and cross-border merchants. Cardholders of seven banks of the Philippines can be enrolled in the program for the time being, among which Security Bank Corporation ranks first to pilot the program, with Asia United Bank, China Banking Corporation, Land Bank of the Philippines and others being in the pipeline.
With the program being available to Filipino credit cardholders, monthly installments devoid of any interest can be pursued by making use of their credit cards. Yet, the credit card can only be used at those establishments backed by the Pay Later identifier and its issuing bank also needs to be enrolled within the program. The program, whose benefits can now be derived with the help of only credit cards, tends to extend its scope for making installment payments through debit cards or directly from one’s bank account via the mobile banking app in the days ahead.
Initiatives similar to the latest one reinforce Mastercard’s continuous efforts to address consumer demand for an increased number of flexible payment options, which, in turn, has bolstered its capabilities and global presence. Programs similar to Mastercard Installments with Pine Labs remain in high demand since it enables consumers to break large purchase amounts into interest-free monthly installments and thereby pave the way for efficient management of one’s finances.
Meanwhile, the program launch in the Philippines came at an opportune time since the country continues to witness the emergence of a cashless society driven by the popular trend to go digital, which lays the foundation for companies with innovative payment solutions (like Mastercard) to capitalize on the country's prospects.
As a matter of fact, Mastercard has improved installment offerings in place to harness the immense potential of the worldwide Buy Now, Pay Later (BNPL) space. MA has resorted to numerous collaborations with industry leaders to sustain its growing presence in the BNPL space. In March 2022, Mastercard joined forces with Mexico’s BNPL platform Aplazo to introduce an innovative virtual card backed by the BNPL facility for enabling Latin American consumers to pursue digital installment payments.
Shares of Mastercard have dipped 0.7% year to date compared with the industry’s 3.2% decline. MA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Similar to Mastercard, other companies such as American Express Company AXP, Visa Inc. V and Global Payments Inc. GPN are also active players in the BNPL space.
American Express has been an active player in the BNPL space. AXP extended BNPL offerings beyond the retail consumer space and integrated these services within the travel space last year. In March 2022, American Express expanded its BNPL solution Plan It to Delta with the aim of boosting its presence in the thriving BNPL space and integrating such solutions within the travel industry.
Visa’s installment solution was first launched as a pilot in 2019. Gradually, the solution expanded to the United States, Canada, Malaysia and Russia. V’s solution was launched in Australia in 2021. A significant number of issuers, acquirers and fintechs utilize Visa Installments Solution to help customers access BNPL options.
Global Payments has enhanced installment solutions in place, which, if integrated into the operations of a company, assure improved checkout experiences. GPN’s TSYS partnered with Mastercard in 2020 to help issuers and merchants in North America provide flexible payment options. The tie-up empowered customers holding Mastercard cards to divide the payment for their purchases into parts or installments.
Shares of American Express and Global Payments have gained 12.8% and 3.8%, respectively, year to date. Meanwhile, Visa stock has lost 1.6% in the same time frame.
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