Mastercard Brings Commercial Cards to Digital Wallets

Continuing the industry’s migration of business payments and expense management to digital platforms, Mastercard announced today (April 18) that it is bringing its commercial cards to mobile wallets.

The move comes in the form of a mobile virtual card app engineered to provide financial institutions with options for delivering secure, contactless payment services—a demand increasingly voiced by the companies’ banking and corporate customers. The app will use Mastercard’s robust virtual card and tokenization technology to offer enhanced data security and spend control features, accessible via a consumer-like interface. It extends Mastercard’s commitment to business payments and management across various sectors, including healthcare, insurance, and corporate travel. It also comes at a time when business travel and expense management has changed with the advent of remote working and addresses the shifting payment preferences by younger demographic groups.

The first two banks to launch will be HSBC Australia and Westpac (Australia, South Pacific). The app will be available in other key markets for users with a commercial virtual card issued through an organization by a participating financial institution.

“Mobile wallet usage is growing, with the Asia-Pacific region accounting for over half of the digital payment transactions globally,” said John Scott, Head of Global Payments, HSBC Australia. “As contactless payments continue to surge, it’s important that corporate clients have access to best-in-class payment solutions to keep their business secure and take advantage of the increased efficiency offered by the latest technologies. HSBC has a history of delivering innovative digital solutions to our corporate clients, and we’re proud to add to that legacy with the launch of mobile wallet virtual cards in Australia. We plan to launch in other markets later this year.”

Once registered for the app with an invitation code, users will find their commercial virtual cards automatically linked and ready to be added to select digital wallets for use across Mastercard’s global network. Rather, Mastercard offers financial institutions branding opportunities within the app – such as full custom card art and links/URLs (ex., Privacy Policy, Terms & Conditions, etc.).

Additionally, from an integration standpoint, Mastercard is also providing financial institutions with options and choices in how they get to market with this new mobile virtual card offering. For financial institutions that are already integrated with Mastercard’s virtual card and tokenization platforms, the onboarding process will expedite mobile virtual card solutions for corporate clients. Financial providers and fintechs that are not already enrolled in Mastercard’s virtual card platform can also quickly get to market via Mastercard APIs or user interface integrations.

According to Chad Wallace, global head of commercial solutions at Mastercard, the primary use case for the app will be expense report and reconciliation processes for corporates and their employees. It also provides new technology and services that FIs can extend to their business accounts. But he’s not expecting its use to be limited to the frequent business traveler.

“We’ve had our virtual card platform for quite some time, usually for procurement use cases,” he told PYMNTS. “And a lot of those are B2B transactions. They’re integrated into various different industry verticals such as online travel agencies being able to pay hotel chains and airlines, all on virtual card. Then we started to take a closer look at some of the different use cases that we could use virtual cards for.”

Read more: Mastercard Says Virtual Cards Bring Speed and Security to B2B Healthcare Transactions

Among those different use cases: contractors, recruits, and consultants who often use personal cards or cash for reimbursable business expenses. To find even more use cases Mastercard reached out to its corporate finance customers for feedback and found them from an unlikely source: Human resources. From this source, it discovered that infrequent travel, occasional business purchases and payments covering job recruitment travel could benefit from virtual cards on mobile wallets. It also found HR executives were a fan of the app’s adherence to corporate expense policies with detailed transaction-level controls, limiting the specifics of card usage.

Wallace also called attention to the enhanced security features of the app. It integrates biometric authentication and a PIN for viewing card details, complemented by tokenization. Other features include flexible integrations for rapid deployment by financial institutions, offering both a proprietary user interface and API-based integration options, along with customizable card designs. It also leverages real-time data insights: Every transaction made with a mobile virtual card captures customized data elements automatically, facilitating improved spend visibility and back-office reconciliation.

“We spend a lot of time making sure that we are integrated into the tools like ERP systems procurement platforms,” Wallace said. “That way data as well as the payment come together. We spend a lot of time listening to the corporations who use our platform, understanding what their needs are, and making sure that we’re building appropriately for them.”