In an effort to take contactless payments to the next level, Mastercard Inc. MA has partnered with NMI and Global Payments (NYSE:GPN) Inc. GPN to launch its first live Cloud Tap on Phone pilot with Computer Engineering Group (CEG).
Among the three participants, Global Payments, a leading worldwide provider of payment technology and software solutions, will provide point-of-sale acceptance technology, NMI will operate as a key integration partner and distributor and CEG will be the first company to pilot Mastercard’s Cloud Tap on Phone.
Cloud Tap on Phone is Mastercard’s new cloud-based point-of-sale technology. The idea behind taking payments to cloud is to broaden cashless payments acceptance for merchants to serve those consumers who want to pay with their Android mobile devices.
Mastercard has been advocating contactless payments technology for over many years now. The launch of this first Cloud Point of Sale (POS) Acceptance Technology comes at the just appropriate time when payments moved online and this trend is here to stay. Demand for faster, more convenient, safe modes of payment shifted people’s preference toward contactless and even after the pandemic subsides, the change will stay and in fact accelerate the trend. Other companies supporting contactless payments are Visa Inc (NYSE:V). V, PayPal Holdings, Inc. PYPL, et al.
Notably, in the third quarter of 2020, contactless penetration represented 41% of in-person purchase transactions globally, up from 37% in the second quarter and 30% a year ago.
Moreover, providing solutions to consumers for enabling them to make payments via their phone is sure to succeed because it eliminates the need for merchants to invest in hardware terminals or add extra features. Merchants can offer an enhanced and expedited pick-up without customers requiring to steping out of their car or provide a payment-on-delivery facility or a faster line-skipping checkout in-store. These options are much sought after by consumers as they prefer touch-free cash alternatives.
Via the roll out of the Cloud Point of Sale (POS), Mastercard is enhancing its Tap on Phone product and enabling ecosystem partners to develop their own cloud-based products with new tools and capabilities. Cloud POS moves payment and security functionality from the individual smartphone to the cloud. The move to cloud will offer robust security, reduce development and maintenance costs, and create scalable distribution channels by allowing immediate connectivity to partners.
Mastercard’s pre-certified Cloud POS software development kits (SDKs) will be widely available in multiple cloud environments. This, in turn, will encourage solution providers, fintechs, acquirers and processors to innovate and co-create new cloud-first products.
The company will conduct further Cloud Tap on Phone pilots and undertake commercial deployments in other markets during 2021.
Currently, Mastercard’s Tap on Phone solution is available in 16 markets across Europe, the Asia Pacific, Latin America, North America and the Middle East & Africa. Pilots are taking place with partners in Costa Rica, Hong Kong, Poland, Kazakhstan, Romania, Canada, Belarus, Russia, Turkey, the United Kingdom among other countries.
Mastercard carries a Zacks Rank #3 (Hold), currently. In a year’s time the stock has gained 6.8% compared with its industry’s growth of 3.7%.
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