The collaboration, announced Monday (Oct. 19), is designed to bring new spend and expense management tools directly to commercial card issuing banks in the U.S. and Canada.
“Banks start with an advantage that’s hard to compete with,” Extend said in a blog post announcing the partnership. “Large banks have historically served about 85% of the small business card market, and businesses trust them with their deposits, their credit, their treasury solution expertise, and ultimately, their business.”
However, the card itself has turned into a commodity, the company added, with issuing cards and offering program benefits no longer enough to stand out. Commercial card issuers are losing out to “software-first providers,” Extend said, as businesses seek better tools.
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“That puts banks in a race,” the announcement added. “To compete for, win, and keep business customers, they need to deliver a modern software experience on top of the card programs they already run, and they need it now.”
Extend said its partnership with Mastercard closes that gap, giving banks an “out-of-the-box, software-first experience” for their card programs, while giving businesses access to things like virtual cards, automated month-end reconciliation, and AI agents.
“We work closely with our issuing banks to understand and serve the needs of business customers,” said Ginger Siegel, head of North America small and mid market business for Mastercard. “The message is simple: they want tools that make their job easier, and Extend does just that.”
PYMNTS Intelligence collaborated with Mastercard earlier this year on the report “Ready for Change: Why Nearly Half of SMBs Want to Ditch Cash and Checks.”
It found that “legacy” payment habits often reflect workflow realities, and a refusal by small- to medium-sized businesses (SMBs) to embrace digital tools.
“In other words, there is real room for progress because the barriers are solvable. When payment providers design around how SMBs actually operate—approvals, invoicing rhythms, liquidity needs, and risk concerns—adoption can accelerate in a way that feels like an upgrade, not a disruption,” PYMNTS wrote.
The report also illustrates why optimism is justified. The SMBs that depend heavily on cash are often the ones most focused on lowering that dependence. At the same time, interest in business credit cards and modern digital payment methods increases when the value proposition is concrete: “better visibility into spending, more flexibility in timing, and stronger protections that reduce operational risk,” PYMNTS added.
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