MasterCard (News - Alert) recently announced an update to its MasterPass digital payments platform that enables consumers to pay for goods directly from enabled mobile apps.
The addition of in-app payments is designed to eliminate the need to store payment card credentials across numerous mobile apps. The goal is to improve customer experience by eliminating the need to retype long strings of numbers on a tiny touchscreen.
“MasterPass in-app payments is the latest offering from MasterCard to address the specific needs of the digital ecosystem,” said Ed McLaughlin, chief emerging payments officer at MasterCard. “We’re creating great experiences for consumers across all channels and all devices, and enabling merchants to reach new consumers in ways not possible in the pre-digital world.”
Given that security is one of the biggest concerns with mobile transactions, the company stressed the security measures it has taken with its MasterPass platform. “We’re also developing a framework to make all payments using MasterPass as or more secure than anything we can do on cards today, ensuring that consumers can benefit from the highest possible levels of security,” McLaughlin continued.
The expansion of MasterPass indicates the aggressive strategy from the payment processing giant, which clearly has its eye on the growing mobile industry. With good reason, of course, with overall revenues from mobile applications, including in-app purchases, estimated to reach $46 billion by 2016, according to ABI Research (News - Alert). That’s a five-fold increase from $8.5 billion in 2011.
ABI Research also estimated that the average global smart device user has 26 apps on a device, which often requires storing payment card and other sensitive information with numerous app providers. MasterPass was developed to streamline that process.
According to the company, once MasterPass is configured, consumers should be able to use a one-click (or one-touch) payments process across the entire device without having to leave an app at all. MasterCard already has signed up Forbes Digital Commerce, Fat Zebra, MLB (News - Alert) Advanced Media, NoQ, Starbucks Australia and Shaw Theatres Singapore to use MasterPass to power their in-app purchases.
MasterPass in-app payments are scheduled to become available during the second quarter of 2014.
In related news, MasterCard also plans to acquire digital wallet provider C-SAM. The company reports that C-SAM’s resources will be integrated with MasterCard's mobile and virtual solutions. Expected to close by the end of the first quarter, financial terms of the deal have not been disclosed.
Edited by Alisen Downey
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