Mastercard (MA) Ties Up to Aid Contactless Payments in Nigeria

Mastercard Incorporated MA recently joined forces with ProvidusBank, Interswitch and Thales Group to facilitate contactless payments for the bank customers via a connected device. This will definitely spur the adoption of digital payments across Nigeria. While ProvidusBank boasts solid digital channels, the two other partners, Interswitch and Thales, are eminent as technology-backed companies.

The collaboration rolls out a Tap-to-Pay solution powered by Mastercard’s Digital Enablement Service (MDES) and the tokenization prowess of Interswitch. The tokenization and digitization technology of MA will be instrumental in making the newly-launched solution across the African country successful by propagating the use of tokens in place of primary account numbers (PANs).

The service intends to benefit ProvidusBank customers, who need to digitize their cards per instructions mentioned in the banking app to conduct Tap-to-Pay transactions.

Following the above procedure, a cardholder requires to open the banking app, choose NFC payments and place his smart device that can be either a smartphone or a wearable device at the contactless payment terminal of any store. With the help of a PIN number, customers can seamlessly complete a transaction, and enjoy a hassle-free and safer checkout experience.

The benefits of the newly-introduced service in Nigeria are not just limited to accelerated in-store payments but also extend to secure in-app and e-commerce payments.

The latest move reinforces Mastercard’s continuous efforts to strengthen its footprint as a leading technology provider of innovative and secure payment solutions worldwide. While the trend to go digital is here to stay, the growing adoption of digital payments simultaneously aggravates the possibility of fraud. To counter this headwind, the new service involves the usage of tokens to impart security, thus preventing the 16-digit consumer card number from getting exposed to fraudsters during online transactions.

Mastercard sets sights on strengthening its footprint across the African nations via its solid digital capabilities. The continent continues to witness a flourishing digital economy, attributable to increased internet usage, a rapidly-growing young population and higher usage of smartphones. In September 2022, MA teamed up with the renowned multinational company Alphabet's GOOGL subsidiary Google to introduce the digital payment app Google Pay across South Africa.

Shares of Mastercard have lost 7.3% in a year compared with the industry’s decline of 28.8%.

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Zacks Rank & Key Picks

Mastercard currently carries a Zacks Rank #3 (Hold).  Some better-ranked stocks in the Business Services space are Waste Management, Inc. WM and Instructure Holdings, Inc. INST. While Instructure currently flaunts a Zacks Rank #1 (Strong Buy), Waste Management carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The bottom line of Waste Management outpaced estimates in three of the last four quarters and missed the mark once, the average being 4.15%. The Zacks Consensus Estimate for WM’s 2022 earnings suggests an improvement of 17.8% from the year-ago reported figure. The same for revenues suggests growth of 10.3% from the year-ago reported number. The consensus mark for WM’s 2022 earnings has moved 2.7% north in the past 60 days.

The bottom line of Instructure outpaced estimates in each of the last four quarters, the average being 40.34%. The Zacks Consensus Estimate for INST’s 2022 earnings suggests an improvement of 9.5% from the year-ago reported figure. The same for revenues suggests growth of 15.4% from the year-ago actuals. The consensus mark for INST’s 2022 earnings has moved 6.1% north in the past 60 days.

Shares of Waste Management and Instructure have gained 11.1% and 7.9%, respectively, in a year.

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