Mastercard’s New York tech hub is trying to push digital wallet adoption forward
NEW YORK — Paying for things used to be fairly straightforward. You handed over some cash, or offered a credit or debit card, and that was that.
But times have changed over the years and payment processor Mastercard is trying to change with them. Walk into the company’s New York City Tech Hub, and you just may see the future.
Mastercard — which does not actually issue credit cards, as its financial institutional partners do that bit — has jumped into mobile payments in a big way, and it sees the Internet of Things as a great way to expand the ways people pay for their purchases. All customers need is a Masterpass account.
Masterpass isn’t new. It’s one of many digital wallets already available but, unlike the others, it isn’t tied to a single payment processor. Masterpass allows you to securely store all of your credit, debit or prepaid cards from Mastercard, Maestro, American Express, Diner’s Club, Discover and even Visa (not PayPal, though – there needs to be a physical card attached to the payment medium). You make payments from your smartphone without having to dig through your wallet for plastic, and it’s accepted at many Canadian online merchants.
To keep things secure, the card numbers aren’t stored on the device, nor are they sent to the merchant. Instead, Masterpass sends a special code known as a token that maps to the card number when the merchant submits the transaction for approval. As a bonus, if your card number has to be changed for some reason, Masterpass will redo its mapping so any pre-authorized payments don’t fail.
In a restaurant, the wait to pay is an average of 11 minutes, said Debbie Barta, Mastercard’s senior vice president of innovation channel management and startup engagement. That’s too long, and led developers to come up with Qkr! with Masterpass, a mobile payments platform that enables ordering and payment through a smartphone.
It’s offered as Qkr! Marketplace, an API (Mastercard actually has around 60 APIs across its portfolio of services in its developer program already), or as an app that venues can brand, and is also integrated into Oracle’s point of sale software and systems. If you’ve ordered food or drinks from your seat at Toronto’s Air Canada Centre, you’ve used Qkr!.
“People are looking for more than just making payments,” said James Anderson, Mastercard’s executive vice president of digital payment products. “Mastercard Labs was formed to force us to look beyond the payment to look at future types of services.”
A car, for example, is just a big steel wearable to him.
To help Canadian customers develop their own payment solutions, Mastercard launched Mastercard Labs as a Service, which provides consulting and support from the company’s Toronto head office. It offers everything from a five-day rapid design and prototyping service through pilot development and product build-out.
That’s today. A walk through the Tech Hub provides a hint of the times to come.
When you walk up to Pepper the robot in the Tech Hub and say, “I’m hungry,” you’re asked to pair it with the Masterpass on your phone and then can order a meal simply by speaking. Pizza Hut has been testing Pepper in Asian markets.
Subway is using chatbots on Facebook Messenger to mirror the conversations customers have with its Sandwich Artists to help them create just the right meal (and, of course, to pay through Masterpass). The bots are supported in the company’s 26,500 U.S. restaurants.
Samsung’s Internet-connected smart fridge already offers a digital bulletin board (lists stuck on the door with magnets are so last century), and an internal camera lets you see what’s on the shelves without opening the door. Next up: ordering groceries and paying with Masterpass, thanks to Groceries by Mastercard, announced last year in partnership with U.S. launch partners, grocers FreshDirect, MyWebGrocer and ShopRite.
Lest you think the Tech Hub is just for consumers, consider Mastercard Retail Insights. It takes advantage of the breadth of anonymized payment transaction data Mastercard has accumulated from over two billion credit cards, plus analytics and a custom integration with Google Maps, to show commercial real estate agents and would-be shopkeepers the relative commercial potential of various locations.
Click a spot on the map of your chosen municipality, and it will show the number of merchants in that block, their industries, and sales rankings and trends over several years. Retail Insights comes in either enterprise or portal editions.
Farther in the future, Mastercard is looking at payment applications for virtual reality and augmented reality, and more Internet of Things twists. What sort? Who knows – as the world evolves, so will payment technology, and Mastercard intends to be at the forefront.