MasterCard and Deutsche Telekom Get to Work in Europe

by Mercator Advisory Group 0

Providing more evidence that a shift toward NFC-enabled payments and some level of cooperation between financial services firms and mobile operators, MasterCard has announced an agreement to work on mobile payments with T-Mobile’s parent company Deutsche Telekom. The partnering of two giant firms with enormous footprints (big feet?) should produce interesting results, but we will have wait many months to see how successful the initiative becomes. From a TechCrunch article:

This service will also be SIM-based, the two companies say. Under the terms of the deal, DT will be working with MasterCard’s payment subsidiary ClickandBuy, which has the e-money license that is necessary to operate mobile payment services.

While Poland looks like it will be a comprehensive roll-out, the German launch later this year will be more gradual: first a trial with mobile phone tags and cards — which will help the service roll out to devices that do not have NFC capabilities built into them; then a mobile wallet service in the first half of next year that will include other banks and partners, before expanding to other markets in the region.

MasterCard emphasized how the latter is bringing payments expertise, while DT, and its mobile brand T-Mobile are bringing the customers.

This announcement makes no mention of what it will cost issuers to provision their account numbers on the mobile devices. But this will be a good thing for MasterCard as the press release declares:

For MasterCard this partnership enables us to deliver safe, simple and smart payments to Deutsche Telekom’s 93 million customers in 12 markets and is a critical step in delivering on our vision of a world beyond cash.

The announcement also points out the impact of payment ecosystem acquisitions the card schemes have made in recent years. Visa’s Cybersource and PlaySpan acquisitions give the company a strong role in e-commerce, gaming, and micropayments. MasterCard’s ClickandBuy gives the card network the ability to provide person-to-person payments and other services.

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