In this exclusive series, MasterCard’s Chief Emerging Payments Officer Ed McLaughlin has spoken with MPD CEO Karen Webster about the general state of mobile commerce, its game changers, and the technology behind mobile security. In the final part of the digital discussion, McLaughlin reveals exciting new announcements for MasterCard and the opportunities it is creating for stakeholders in the mobile commerce ecosystem.
MasterCard’s vision for mobile commerce is now pretty clear: use the power of digital to enable “shortcuts” to commerce for consumers around the world. In some cases, those shortcuts enable access to digital commerce channels never before available. In this last segment, MPD CEO Karen Webster topped off the digital discussion by asking MasterCard’s Chief Emerging Payments Officer Ed McLaughlin to give us a peek into the new mobile commerce initiatives and activities on their roadmap.
Earlier this year, MasterCard made news by announced HCE (host card emulation) a new software based “payments-enabling capability” that offers a new and secure way to store cardholder credentials.
“Now, with the KitKat release of Android, we’ll have the ability to actually store the credentials more remotely – that’s where HCE comes in – and use that to drive secure transactions off the device through connectivity,” said McLaughlin. HCE, he said, provides a hardware extraction layer where embedded, SIM-based, or remote models can be accessed seamlessly from a mobile device. This allows for contactless, in-app, or online transactions – a “third leg of deployment for device enablement” which McLaughlin characterizes as fundamental.
Another key announcement, said McLaughlin, was the MasterPass in-app payment capability, which “builds on this concept of having access to the secure credentials” This functionality allows consumers to access payments in the MasterPass wallet from their favorite application.
MasterCard also announced a partnership with Syniverse, a technology company that manages a variety of mobile voice and data services, including roaming. It is this capability in particular that will be adapted to the MasterPass wallet so that an additional level of authentication can be done at the device level, confirming to the merchant that the mobile device is in the same location as the transaction is occurring.
The important news, then, is really “about enabling technology like HCE, the extension of the MasterPass in-app, and combining networks and information streams that were never brought together before,” said McLaughlin to create a secure, frictionless experience for the consumer and the merchant.
McLaughlin also noted that these new initiatives aren’t just about adding value to existing transactions, but creating new value for different stakeholders in the ecosystem, and new ways to monetize mobile commerce from the deployment of different business models.
“This marketplace has been treated as sort of a zero-sum game. There are opportunities now for better merchandising, secure transactions, deeper consumer engagement, and I think that’s truly how we monetize – how we pay off the promise of what’s here,” said McLaughlin.
In ending the discussion, Webster asked McLaughlin to fast-forward ten years, to predict the state of mobile commerce. McLaughlin reminded us that the physical world will always be there even though the devices we use to access payment and commerce will evolve.
“I think the connectivity will always be with us,” he said. “And what consumers will want and have is the ability to get direct access to their financial capabilities, from any device – and commerce will be more and more seamless because of that.”
And, McLaugling said, MasterCard will be a key player in making that future a reality.
This 15-minute segment covered the following key topics:
1.What are the recent announcements MasterCard has unveiled?
2.What is the role of the network in driving mobile commerce forward?
3. How are new opportunities created for stakeholders, and how can they monetize?
4.Where will the state of mobile commerce be ten years from now? What will have changed, and what role will MasterCard have played in getting through the change?