Mastercard Incorporated MA has tied up with Wirecard, the global innovation leader in digital financial technology, to expand the reach of the global issuing business.
Via the pact, Mastercard Prepaid Management Services (Prepaid Services), a leader in prepaid program management, will be aided by Wirecard’s long-standing expertise in global issuing services. Both the companies aim to exploit the growth potential in the field of digital prepaid payment solutions.
The companies, via their existing and new prepaid solutions, will further provide payment choice to a broader audience. Their targeted customers are travel agencies, airlines, governments and SMEs.
Mastercard aims to drive the trend of the global cashless society via the issuance of prepaid cards and card programs, through this pact. Prepaid Services are widely used in more than 20,000 selling locations, with active programs in 23 countries worldwide. Wirecard will support Prepaid Services, with its global licensing footprint and expertise in issuing services.
This collaboration will shape the future of the international payment market, with tailor-made solutions for specific industries. Mobile apps are set to become the payment solution of choice worldwide and both the companies are trying to harness the changing payments market via digital prepaid cards.
A recent survey by Discover Financial Services DFS, another payment company, revealed that a distinct trend is being witnessed among the younger generation who resort the most to mobile payments compared with the older generation. The youngest generation is the most tech savvy among shoppers. 80% of Gen Z is most likely to use their mobile device to shop for holiday gifts compared with 73% Millennials, 62% Gen X and 41% Baby Boomers.
This clearly points to the fact that the shift in electronic mode of payments will continue to catch up with demographic changes. Companies in this space have already sensed this disruption, and have been continuously making billions of dollars of technological investments in their systems, procedures, and networks.
This June, another company in the same space, Visa Inc. V partnered with Wirecard to collaborate on new solutions in the field of digital financial technology.
Mastercard currently carries a Zacks Rank #3 (Hold). The stock has gained 31% in a year’s time compared with the industry’s growth of 18.5%.
A better-ranked stock in the same space is Envestnet, Inc. ENV. It carries a Zacks Rank #1 (Strong Buy) and has surpassed estimates in each of the four reported quarters, with average positive surprise of 5.54%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
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