In Profile
Editor's Choice Europe Paytech

In Profile: David Jones of Mastercard

This week, The Fintech Times spoke with David Jones, head of fintech, UK and Ireland, at Mastercard about the payment giant’s evolution to keep up with innovative fintechs and evolving payment preferences. 

What is the Mastercard offering?

 

David Jones, head of fintech, UK and Ireland, at Mastercard
David Jones, head of fintech, UK and Ireland, at Mastercard

Mastercard is customer-centric, collaborative and consultative. We started with card payments, but now we also focus on cultivating new technologies to deliver new types of payment experiences.

We operate a multi-rail network that offers our customers one partner to turn to for their domestic and cross-border needs. It’s simple, it’s frictionless. It’s delivering today that one seamless onramp to choose and activate any type of payment; cards, account to account, blockchain and new open banking and digital currency capabilities.

To give you an idea of our scale there are three billion Mastercard branded cards in circulation around the world, accepted at over 80 million acceptance locations. In 2021 alone 112 billion transactions were switched on the Mastercard network.

What is driving partnerships for Mastercard in the UK? Why are partnerships in fintech important?

Tech is easy. Scale is hard. You need an ecosystem to thrive, and we have that. Competition and partnerships are good for us and makes us better as we empower people and power economies.

We believe innovative fintech and bold ideas should be supported by a partner whose beliefs and ambition match their own. Working with fintech is a two-way street for us. We help them focus and grow, whilst also learning from them and innovating with them.

We have fintech partnerships in 172 countries and we’ve supported a diverse mix of 260 companies across 40 countries through our award-winning Start Path startup engagement program.

How have partnerships evolved over the years – and what can you offer new and innovative fintechs?

Mastercard has been partnering with fintech builders for years. The more fintech companies we partner with, the more powerful our network becomes – as a result, we’re building on our leading position. Our approach to relationships with our customers and partners is maximising the unique value, experience and know-how that we hold, whilst supporting innovation to enable choice and create value for all of our stakeholders.

As we transform, fintech is playing an increasingly important role and we know that many of them benefit from our years of experience, in fact we’d say we are one of the original fintechs.

Why are partnerships in fintech important and will they continue to be relevant in 2022?

There are many challenges for new fintechs entering the market – some sectors of financial services have more barriers to entry than others – but one of the biggest ones we hear from fintechs is not knowing where to turn for advice. Being able to speak to others in the industry who’ve been in the same situation and who know the challenges and have connections or insider knowledge can be invaluable.

We have an entire portfolio – Mastercard Developers – dedicated to fintech programmes, products and tools that fintech companies of any size can benefit from even as the sector continues to evolve.

Mastercard Developers is a portfolio of products, tools and programmes to support fintechs on their scaling journey. From high-potential startups to fintech enablers, fintech companies of all sizes can gain access to everything they need to build, launch and grow through the Mastercard Developers portfolio.

We provide valuable resources for developers across the globe, offering a simple interface and user experience – and this includes a big focus on community and networks:

  • Partner Network: Qualified fintech enablers receive access to the Mastercard network to pre-integrate or bundle products and services so they are better equipped to meet customers’ needs and/or locate the right third-party partner to enable their own growth.
  • Fintech Community: Any fintech builder can sign up to be part of Mastercard’s new global fintech community of like-minded companies that use the platform to be inspired, stay informed and connect to peers, helping them evolve their business at pace.
What does the future of credit cards look like? Especially with the growing payment option that is BNPL and its popularity. What impact does BNPL growth have on a giant like Mastercard? 

Credit cards are hugely popular and will remain so, but equally payment innovation, like BNPL, is offering alternatives to tradition forms of credit, which for some people will be preferable.  It’s important that consumers have choice and can decide what type of payment works for them. Ultimately, competition is good for customers – it makes for better services and more choices. It’s also good for us – it makes us better and helps drive more innovation.

Last year we launched Mastercard Instalments – our own Buy-Now-Pay-Later (BNPL) programme. It enables banks, lenders, BNPL players and wallets the ability to offer BNPL experiences at scale with merchants across the entire Mastercard acceptance network.  This builds on Mastercard’s investments in open banking to deliver a simple and convenient experience for consumers, merchants, and lenders by accessing a person’s account-level transaction history to support the underwriting process, enabling credit to be safely extended and facilitating a preferred method of repayment from a debit or savings account.

What are the major trends in the fintech/payments industry currently, and how has Mastercard reacted/been affected?

It’s been almost two years since the start of the pandemic. As we progressed through it, we’ve had two choices; react to the trends of each day or use this moment to take the work we have done and the diverse set of capabilities we have developed leveraging our scale, technology and expertise to reignite the future – and the future of innovation.

For us, the pandemic has been an accelerator to our strategy as opposed to something that necessitated a change in strategy for us – we have proven our resiliency by putting customers and consumers first. Payments, and more specifically Mastercard, are at the core of the digital revolution – powering a new economy, with new products, new sales channels and new consumer experiences, like never before.

The change in preferences, values and attitudes among consumers and wanting to be able to do things remotely to minimise contact with other people and things – are all areas we’ve been investing in for years. Over the past two years, consumers and businesses have had problems to solve. A key theme throughout is the acceleration of digitisation – driven not only by the pandemic, but also by innovations in payments in areas including eCommerce, the consumer experience at the point of sale, digital wallets, instalment programs, digital currencies, open banking, and more.

With innovation comes the opportunity to work with our partners – both existing and new – to better serve the needs of consumers and businesses as we shape the future of payments.

How is financial inclusion going to be achieved through Mastercard? What is being done to ensure this in the UK? How can Mastercard help aid financial inclusion in the UK?

Mastercard is aligning its mission to connect one billion people to the digital economy by 2025 with fintech companies in more than 172 countries, curating a global network of innovators with the goal to co-innovate solutions that enable a more inclusive economy.

In the UK, recognising the cross-section between digital and financial inclusion we’ve developed a programme with not for profit organisations Good Things Foundation and Clean Slate called “Nobody in the Dark”, which aims to respond to the emergency needs of, and provide immediate support to, people in poverty in the UK who are digitally and financially excluded. We give households in poverty access to digital devices and/or data, plus basic digital support. This project also provides money guidance support and upskills to use tech to help with money management. This is now live in 20 regional centres across the UK.

The principal challenge is that the individuals who are most financially excluded are also usually those who are hardest to reach. Their needs are often complex, they will tend to also be digitally excluded and often have a degree of social exclusion too.

This means that a one size fits all approach does not always work.

As banking and financial services evolve, we see exciting potential for fintech to support financial inclusion – as the Kalifa Review of UK fintech has highlighted. But this potential may not be realised without a culture shift and we are working with across the public and private sector to facilitate this.

How is the evolution of crypto impacting Mastercard?

The potential for digital currencies to change everyday payments is massive. Mastercard needs to be in the space, helping shape it, guide it, and provide consumer protections and security.

Our work with digital currencies builds on our strong foundation to enable choice and peace of mind when people shop and pay. A principled approach to innovation is the best – and only – way to navigate a space as dynamic as payments, now and in the future.

No matter the platform or technology – in this instance the digital currency type – we believe in three foundational principles that guide our decision making in the space:

  • Stability: A connection to fiat currency will help provide reliability and assurance, starting with reducing significant fluctuation in the perceived value. This makes it more relevant for everyday purchases.
  • Regulatory Compliance: This starts with whether it is permitted as a medium of exchange in a specific country and continues through all forms of regulation, including AML and sanctions compliance.
  • Consumer Protection: People expect guaranteed payments, defined value, data privacy, data security, and protection against fraud or theft, as they do when using more established electronic payment systems.

Author

  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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