Mastercard Makes P2P Ubiquitous And Real Time

P2P has shifted over the last several years from being a nice-to-have to a must-have solution for banks.

With the adoption of mobile and online banking, and the proliferation of non-bank solutions providers such as PayPal, Venmo and Square Cash, consumers have come to expect that the digital transfer of funds from one person to another is as easy – and instantaneous – as handing someone a $20 bill.

Today, Mastercard announced that its Mastercard Send platform will power the Early Warning clearXchange network in an effort to do that for clearXchange customers.

When launched later this year, any clearXchange customer will be able to send money to any other person in or outside the EWS clearXchange network using their debit card.

Jennifer Rademaker, EVP of U.S. Solutions Sales & Customer for Mastercard, said the move will bring a new value proposition to Early Warning’s member banks and consumers by offering a more open P2P network and the availability of funds in real time.

“Now those [clearXchange] consumers will be able to reach almost any U.S. debit card,” Rademaker explained, noting that the reach of Mastercard Send also includes non-Mastercard debit card accounts.

Though bank customers within Early Warning’s bank owner network can make P2P payments today, they have have been limited to sending and receiving funds only with others within the member bank network, via ACH from one bank account to another and a delay of up to three days before money hit the receiver’s bank account.

But with the integration of Mastercard Send – a service that Rademaker says reaches 97 percent of U.S. debit card accounts – member banks will be able to offer a real-time P2P capability that extends the P2P solution outside of their current network members.

The Power of Ubiquity

Rademaker pointed out that Early Warning’s decision to use Mastercard Send to expand its P2P capabilities is a move that will continue to provide a way for banks to stay competitive in this evolving digital space.

“Mastercard Send service is essentially underpinning our banks’ ability through Early Warning to be able to compete in that space with some of these other up-and-coming digital players,” she continued.

But as good as enabling payments between consumers in real time is, Rademaker says that it isn’t enough.

Outside of providing unique and meaningful value propositions, she contends that any P2P solution today must offer ubiquity, since when a consumer is looking to send a friend money for walking their dog or picking up the tab at dinner, they don’t have a clue which financial institution that person banks with.

And that, she says, shouldn’t stand in the way of making a payment happen.

Rademaker confirmed that the testing of the Mastercard Send service on the clearXchange network will continue through 2016, hinting that there’s also a chance that it becomes the foundation for other capabilities beyond just connecting a consumer to another consumer.

“Because we see how powerful this product is in terms of the immediacy, the reach – I think it’s fair to say we are looking in a lot of different spaces to be able to leverage this capability,” Rademaker said.