PayPal and MasterCard have inked a deal giving MasterCard prime time visibility in the PayPal matrix. Whether using PayPal to buy a movie ticket, dinner or something else people will be able to choose to pay directly with their MasterCard when using PayPal Wallet – and set it as their default payment.
For consumers this is seen as a way to have more choice and flexibility, but it also means that they will get the same protections and safety protocols when using their MasterCard through PayPal to make a payment that they get elsewhere.
“Whether paying in the physical or digital world, consumers want to see the familiar MasterCard brand from their chosen issuer,” said Ajay Banga, president and CEO, MasterCard. “The expansion of the partnership with PayPal further reinforces our commitment to our billions of cardholders across the globe to provide them the choice to pay when, where and how they want while delivering the simple and secure payment experience they’ve come to expect from MasterCard.”
The nitty gritty
Striking this deal with MasterCard means that MasterPass is now an option for Braintree merchants, thereby increasing PayPal’s presence at checkout. Here too this part of the deal is seen as a way to not only give PayPal customers more options, but it also increases value for financial institutions, as well as MasterCard cardholders.
This partnership also means that both small business owners and consumers will be able to cash out PayPal funds and instantly send them to their MasterCard debit card to give them more flexibility when managing their funds.
In the contract there are also financial volume incentives for MasterCard, and they will no longer have to pay a digital wallet operator fee.
Security, security, security
Tokenization has become a key way to enhance security, and with this expansion consumers will be able to actually pay with their tokenized Mastercard via their PayPal Wallet, when making purchases in real time.
This gives them an additional layer of security when shopping and paying bills, along with access to over five million retail locations around the world outfitted to take contact-less payments.