Mastercard, a global payments and technology company, is launching several initiatives in India, including the setting up of a processing centre and services hub. It also plans to increase the number of payment terminals to one crore by 2020.
In an interaction with BusinessLine , Vikas Varma, Senior Vice-President, Account Management, South Asia, Mastercard, said the company is in the process of setting up a full on-soil domestic transaction processing centre for India at a cost of $300 million.
Another part of the investment will be directed towards building a services hub, which will focus on developing and delivering other value-added services such as authentication, tokenisation, cybersecurity and intelligence solutions, and data analytics. “This is a significant investment in technical capabilities, which will allow the processing of domestic transactions in India, and also provide the potential for the co-design and co-development of such services and solutions locally in collaboration with global teams,” said Varma.
RBI directive
He pointed out that with the Reserve Bank of India making it mandatory that the data of Indian consumers should be stored in India, Mastercard has decided to set up the processing centre here. “We are perhaps the only global payment network to do this. So, there is one such centre for 222 countries globally in the US and another one for India. We hope to use the Indian centre as a tech node for other parts of the world as well, and we believe it will lead to more jobs here,” he said. He said before demonetisation there was not much traction for the company, but after that growth has been extremely good.
Mastercard recently announced an investment of $1 billion over the next five years in India, in addition to its earlier investment of $1 billion between 2014-19. Nearly 14 per cent of the global workforce is based out of India, which Varma said was significant for a company that operates in over 200 countries.
Mastercard has, so far, acquired two companies in India that are based out of Pune and Vadodara. The Vadodara facility runs the global mobile payment centre of excellence. The Gurugram facility operates the data analytics centre for the company.
“Post demonetisation and GST, there has been an upswing in the number of people using electronic payments. Four to six years ago, electronic payments, as a percentage of total personal consumption, was between 3-4 per cent, but it has now gone up to 10 per cent. What it means is that there is still a 90 per cent headroom for growth,” said Varma.
Varma said Mastercard is not just in the business of enabling cards but is also in the business of enabling bank accounts for payments. It recently bought a UK-based company, Vokalink, which carries out account-based payments.
“So, if the customer wants to pay through bank accounts through Vokalink, this can be enabled, too. We are not differentiating in the way the consumer wants to pay,” he said.
Mastercard is also making it safer for consumers to carry out transactions, especially for big companies. It has developed a product called Safety Net, which looks at transactions at an aggregate level.
It is able to convert all random numbers to token numbers which only the issuer will be able to identify.